BM461 - Global Business Environment: TESCO Report Analysis

This report provides a comprehensive analysis of TESCO's global business environment. It begins with an introduction to the global business environment and its influence on organizational decision-making, focusing on TESCO plc. The report includes a SWOT analysis of TESCO, examining its strengths, weaknesses, opportunities, and threats. It then delves into the impact of key drivers of the business environment, such as political, economic, social, technological, and legal factors, on TESCO's functional areas, specifically HRM and marketing. The analysis considers the effects of Brexit, competition, and technological advancements. The report uses academic sources to support its findings and concludes with a summary of the key points. This report fulfills the requirements of the CW2 assignment for the BM461 Global Business Environment module.

Global Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
SWOT analysis ..........................................................................................................................1
Impact of key drivers of business environment on firms functional areas.................................3
CONCLUSION ...............................................................................................................................4
REFERENCES................................................................................................................................5
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INTRODUCTION
Global business environment is mainly associated with uncontrollable and exogenous
factors of an international market that have influence on decision making and other capabilities
and operations of an organization (Stanković and Novaković, 2019). This part of assignment is
based on TESCO plc which is a leading and well known British multinational retailer having its
headquarter in England, UK. This assignment consists a SWOT analysis together with impact of
key drivers on functional areas of a firm.
SWOT analysis
SWOT analysis is basically a matrix that provide information regarding the internal
strengths and weakness of an organisation that makes it able to grab the opportunity and reduce
the negative consequences of threat. TESCO is among one of the leading retailer which deals in
groceries, F&F Clothing, and other associated items across various regions of world that includes
UK, Europe, Asia, Ireland, Hungary, Thailand, etc (Andresen and Bergdolt, 2019). Following is
the SWOT analysis of TESCO organization reflecting its internal capabilities and weakness
together with the existing business opportunity and threats:
Strengths Weakness
 The biggest strength of TESCO is long
standing history in UK which is the
reason behind having a credibility and
loyalty among customers and accounts
for 28.1% of total market share of UK
which makes it a leading retailer across
the UK (Tesco SWOT Analysis 2019,
2019).
 Strong and wide range of Product
portfolio especially in top driving
sectors that includes groceries, clothing,
electronics, furniture etc. enhance its
capabilities.
 TESCO is also among one of the
 Failed operations and business project
in US and Japanese market thus, have
to close many stores and faced a lot of
loss in these markets.
 After the Brexit referendum the
TESCO is facing a worst performance
that has lead to reduction in its
operating profit by 9% after 2018.
 Brexit issues has also lead to a decline
in share price of TESCO which are at
below peak in October 2019.
 Maximum amount of spendings are
made in markets of UK and Europe
which hinder performance of TESCO at
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largest and most profitable
supermarkets of world and also having
a strong financial positions which is
reflected through its listing on London
Stock exchange and FTSE index.
 Beside this, use of superior technology
like RFID – enabled barcode system
and other new and advance packaging
techniques provide a unique and
differentiated position in business
market together with enhancement in
customers experience.
 Apart from this, the effective marketing
strategy together with efficient online
operations are also a strength of
TESCO plc.
other developing market thus, have
limited presence in emerging counties
as compared with other competitors.
Opportunities Threats
 TESCO can go for further
diversification in its product and
strategies and have an opportunity of
expansion of operations in many other
sector like TESCO Bank (Özcan,
2019).
 TESCO is having an opportunity to
grow its business and enhanced its
position as a low cost rival thus, has
announced the introduction of a Jacks a
low cost rival to Aldi and Lidl.
 TESCO can purse international market
expansion strategy to improve its global
 Its brand image get damaged due to
many commercial income scandal,
financial frauds and infringement
controversies which has created a threat
on loyalty on customers.
 After the Brexit issue a high level of
currency fluctuation is seen and the
value of pound is also diminishing
which is causing a threat for profit
margin of TESCO.
 Global economic environment and
insatiably in business environment is
cresting a threat on overall business
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presence and expand into oversea
market through having effective online
business and transaction together with
more better marketing and promotional
strategy with the help of digital and
social media.
operations and demand of products of
TESCO.
Impact of key drivers of business environment on firms functional areas
The hey drivers of business environment includes various factors associated with
political, economical, social, technological, legal and many other factors that create significant
effects on functional units and operations of an organisation (Gawin and Marcinkowski, 2019).
Following impacts are created by key factors of business environment on functional areas of
TESCO:
HRM function
This functional area of TESCO is associated with the recruitment and procurement of
talented and skilled employees for the performing various tasks and jobs within the organisation
(Rao, 2019). It has been that the, Brexit issue is affecting labour supply and has created a high
level of employees turnover thus negatively affecting the operations of TESCO. Therefore to
meet theses consequences and to retain its talented employees some effective HRM strategies
should be adopted by TESCO. Beside this, increasing competition and chaining technology has
also impacted the HRM policies of TESCO and more emphasis is provided to training and timely
development programmes for employees to enhance their performance and sharpen their skills to
face the competition and also makes adoption of new technology relative more easy.
Marketing Function
Marketing function of TESCO is having a responsibility of developing effective relation
with customers together with better understanding of business environment and ongoing changes
so that effective promotional strategy can be made to create an awareness about the product and
brand in the target market with the aim of enhancing its customer base and global presence
(Stanković and Novaković, 2019). The various existing opportunity in the market to have an
expansion in emerging market of world has lead to an impact on marketing function of TESCO
and effective policies and strategies are needed to have better interaction with its customers at
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global level. Changes in Technology has created an impact and has enhanced the opportunity for
marketing function of TESCO through facilitating use of social media, like Facebook, Instagram,
twitter and other digital technology like online websites and digital advertisement to have better
promotion of its product at developing and emerging markets. Effective marketing strategy also
reduce the threat of high level of competition and yield a better market position for TESCO
across the world.
CONCLUSION
On the basis of above assignment it can be concluded that use of SWOT analysis is made
to evaluate and analysis the internal capabilities, strengths and weakness together with
knowledge about opportunity and threat. It has been also summarised that various key factors of
a business environment exert significant affect on functional areas of an organisation.
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REFERENCES
Books and journals
Andresen, M. and Bergdolt, F., 2019. Individual and job-related antecedents of a global mindset:
An analysis of international business travelers’ characteristics and experiences
abroad. The International Journal of Human Resource Management, pp.1-33.
Gawin, B. and Marcinkowski, B., 2019. Making IT global–what facility management brings to
the table?. Information Technology for Development. 25(1). pp.151-169.
Özcan, A., 2019. The Role of Human Resource Accounting in the Business Environment.
In Global Perspectives on Human Capital-Intensive Firms (pp. 99-120). IGI Global.
Rao, I., 2019. Competing values in Asian business: evidence from India and Dubai. Journal of
Asia Business Studies. 13(1). pp.97-107.
Stanković, J. and Novaković, I., 2019. Impact of Local Self-Government Institutions on Creating
a Business-Friendly Environment: Multi-Criteria Analysis. In Socio-Economic
Development: Concepts, Methodologies, Tools, and Applications (pp. 1466-1488). IGI
Global.
Online :
Tesco SWOT Analysis 2019. 2019. [Online]. Available Through:
<https://www.learnmarketing.net/SWOTTesco.html>
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