The Role of Information Systems and ERP in Tesco's Business Strategy

This report provides an in-depth analysis of information systems and Enterprise Resource Planning (ERP) systems, focusing on their application within Tesco, a multinational retail company. The report begins by defining and categorizing different types of information systems, including transaction processing systems, management information systems, and decision support systems, illustrating their roles and importance in business operations. The core of the report centers on ERP systems, detailing their features such as enterprise-wide integration, common database creation, and consistent user interfaces. It explores the benefits of ERP systems for Tesco, including improved data security, enhanced community knowledge, better business decision-making, regulatory compliance, employee empowerment, and the use of mobile applications. The report concludes with recommendations for Tesco's management, emphasizing the strategic use of ERP software to improve efficiency, effectiveness, and overall productivity.

Managing
Information and
Technology

Contents
INTRODUCTION...........................................................................................................................................3
MAIN BODY.................................................................................................................................................3
Categories of information systems..........................................................................................................3
ERP systems.............................................................................................................................................4
Benefits of ERP systems...........................................................................................................................6
Recommendations.......................................................................................................................................7
CONCLUSION...............................................................................................................................................7
REFERENCES................................................................................................................................................8

INTRODUCTION
Managing information and technology refers to the processes, techniques and systems
used by a firm to manage its information effectively and efficiently (Blackwell, Gardiner and
Schoenebeck, 2016). It is necessary because it helps a lot in proper management of the data
ensuring its security and safety. This helps the management in keeping sensitive data of the
enterprise secure to prevent its misuse. The company chosen for this report is Tesco which is a
British multinational company dealing in various types of products and having a large base of
customers. The purpose of this essay is to appreciate the role of information systems in business,
describing the various information systems and identification of categories, demonstration of
understanding of role of information in the operations of business organizations. Also, it aims at
demonstration of understanding of suitable information systems for effective management and
communicate the IS/IT solutions. The essay will include a detailed discussion of enterprise
resource planning i.e. ERP systems. It will be supported by references from the Harvard
Referencing System. Thus this essay will include various aspects of ERP in the context of Tesco.
MAIN BODY
Categories of information systems
There are various types of information systems which can be used by a business. The
explanation of these systems in the context of Tesco is as follows-
Transaction processing system- Transaction processing system is used in order to
record the day to day business transactions of the organization (Busse, Meinlschmidt and Foerstl,
2017). In a big organization like Tesco, there are multiple departments such as production,
marketing, sales, HR etc. These departments have multiple transactions of their day to day
activities. Thus this system can be used to efficiently and effectively summarize these
transactions and process them for the purpose of analysis and interpretation later on.
This system makes the work in the organization quite smooth which helps in achievement
of short-term and long-term goals and objectives of the organization. Thus the managers of the
company should focus on its implementation which will help in attaining the required
smoothness in the working of the company. This will also help in raising the overall efficiency,
effectiveness and productivity in the organization.
Its examples include point of sale systems, payroll systems, stock control systems and
airline booking systems.
Management information system- Management information system i.e. MIS helps the
managers in tactically monitoring the organization’s current performance status. The managers
can use it efficiently and effectively to measure the performance as well as monitor it.

This system not only helps in measuring performance but also helps in identifying the
variances and deviations in the performance. Thus quick rectifying actions can be taken for the
purpose of improvement by the managers. The managers of Tesco can use this system so that
they can not only measure their performance but can also take steps to improve it substantially
which will help the company in the long-run.
Examples of this system include sales management systems, budgeting systems and
human resource management system. These are the most important systems in the MIS.
Decision support system- This system helps the management to take certain decisions
which may benefit them in the short-run as well as the long-run (Hu and Kapucu, 2016). The
most important task which the managers have to perform is taking of decisions which have an
impact on the organization. These can be routine as well as non-routine decisions which can be
taken by the management.
The managers of Tesco need to take decisions using this system as it helps them in doing
analysis and interpretation before they take an impactful decision which can change the working
pattern in the organization and can affect its functioning. Certain decisions like raising the
productivity of employees using different training techniques and taking measures to get ahead
of competition level to attain sustainable success can be taken by using its help.
This system can be also used to find out problems, errors and faults and using different
approaches to solve them. Overall, the efficiency, effectiveness and productivity in the company
can be raised significantly by using this system.
Examples of this system are financial planning systems, bank loan management systems.
Justification- From the above discussion, it can be summarized that Transaction
Processing System should be adopted by Tesco for its operations. This is so because this system
will help it a lot in integration of transactions of its various departments and will reduce the
chances of errors and mistakes. This will lead to much required efficiency, effectiveness and
productivity in the overall operations and functioning of the company.
ERP systems
Enterprise resource planning i.e. ERP is a centralized system which helps in facilitating
integration between different functions of the enterprise be it production, finance, marketing,
sales, HR etc. Tesco uses this system to bring smoothness in its operations (Huh, Cho and Kim,
2017).
The features of ERP systems are as follows-
ERP systems facilitate enterprise-wide integration of different types of functions in an
enterprise such as production, finance, marketing, HR etc. The managers of Tesco can benefit
from it as it will lead to achieving greater efficiency and effectiveness in the functioning of the

organization. Tasks can be allocated easily and transfer of authority can be done smoothly which
helps in easily fixing responsibility and accountability.
ERP systems help in quickly identifying the problems and issues with the working and
functioning of the organization (Ilmudeen and Bao, 2018). In a big organization like Tesco the
problems can occur while performing day to day activities of the business. These issues can be in
any department of the organization such as production, finance, marketing, sales, HR etc. They
can affect the performance in the company. Thus by using ERP systems quick rectification
measures can be taken to resolve the problem and actions can be taken so that the problem does
not recurs in the future. If one department’s problem is linked with another department then a
solution can be easily found to them. This is made possible due to the integration of all the
departments into one system. Thus greater efficiency, effectiveness and productivity can be
ensured in the organization.
ERP systems facilitate making of a common database in which data of all the
departments of the enterprise can be stored easily. Tesco’s managers can use ERP systems in
order to keep a common database of various departments of the enterprise such as production,
marketing, finance, sales, HR etc. This helps to find out the data easily whenever required. Also
the problem of loss of data can be avoided. Thus greater efficiency, effectiveness and
productivity can be ensured within the departments of the company. This helps in carrying out
the work with relative ease and proper allocation of tasks in the organization. Also this common
database can help to integrate data between departments. Thus a much-required smoothness can
be brought into the departments of the enterprise which helps a lot in smooth functioning.
Productivity of employees of these departments also increases due to making of a common
database in the firm.
ERP systems offer a consistent look and feel due to the user interface set in the software.
It leads to a reduction in training costs and looks more professional (Laudy and et.al., 2017). This
helps the company in many ways. In the context of Tesco, it is important because it helps its
employees and thus their overall efficiency, effectiveness and productivity increases
substantially. This also facilitates the achievement of consistency in performance and
improvement in the overall results obtained in the organization. Proper training can be provided
in the company by using it which can lead to a decrease in the training cost. Help is provided to
the workers by the ERP systems which improves their performance and also helps them in
achieving consistency. Thus using this system short-term and long-term goals and objectives of
the company can be achieved easily if consistent efforts are put in by the employees and
management.
ERPs are of various types like Tier I ERPs, Tier I Government ERPs, Tier II ERPs, Tier
II Government ERPs, Tier III ERPs and Tier IV ERPs. A company can choose any one of them
according to its needs and requirements.

Benefits of ERP systems
The benefits of various types of ERP systems in the context of Tesco are explained as
follows-
Improvement of security- ERP systems help in improving and strengthening the
security of the data of various departments in the organization (Maetzler, Klucken and Horne,
2016). These systems can keep the data of company secure from hackers and thus are quite
useful for a big company like Tesco whose data is sensitive in nature.
Making use of community knowledge and support- ERP systems can help in making
the use of community knowledge and support (7 Little-Known Benefits of ERP Systems, 2020).
Tesco’s managers can make use of information available from other organizations and business
community. This can help in analyzing the problems and issues which the business may be
facing and taking effective measures to eradicate them as quickly as possible so that the long-
term aim of maximization of profits can be achieved. It can also help in creating and innovating
different ideas which help a company in the long-run.
Taking better business decisions- ERP systems help a lot in taking of better business
decisions which can benefit a company both in the short-term and the long-term. Tesco’s
managers can benefit by it as they can analyze very carefully before taking an important decision
which will help them in taking the right decision which will certainly lead the company to
sustainable success in the future time period. Also the decision-making skills of the managers
can be developed by the use of ERPs.
Staying on top of regulations- ERP systems help in easily handling the laws, rules and
regulations which are framed by the government from time to time (Pattinson and et.al., 2017).
Tesco’s managers can integrate the data of various departments which also helps them in
following the rules and regulations established by the government. Most of the ERP systems are
designed in order to ease the regulatory compliance which is required for business processes
such as financial accounting, data security and product traceability. Thus smoothness can be
brought into these processes which raise the overall efficiency and effectiveness in the operations
of the enterprise.
Giving employees more power- ERP systems give the employees more power as they
can be given a chance to take decisions on the behalf of the company (Rohitratana, 2017). Tasks
are effectively delegated to employees according to their capabilities which enhance their level
of productivity. Tesco’s management can use these systems to give more power to its various
employees and ensuring that they take the right decision which can be beneficial for the
company both in the short-run and long-run. Also the workers can share their creative and
innovative ideas in front of the managers which can be helpful for the company in maximizing
its profits.

Mobile applications- Many ERP software also have mobile applications which help
managers in managing business on-the-go. Updates related to crucial KPIs such as sales,
revenue, customer acquisitions, web traffic and manufacturing output can be effectively
monitored by the managers of Tesco. If there are any problems they can be quickly resolved.
Number of software options- ERP software comes in a range of options according to the
needs and requirements of different types of companies (Sandoval-Almazán and et.al., 2017).
Tesco’s managers can choose an option which is the most suitable for them according to their
needs and requirements and also results in increase in their efficiency, effectiveness and
productivity. The option of software must be chosen very carefully by the management of the
company.
Recommendations
From the above discussion, it can be recommended to the management of Tesco that it
uses ERP software so that it can help it in bringing more efficiency, effectiveness and
productivity in its operations.
CONCLUSION
From the above report, it can be concluded that managing information and technology is
an important task in front of management of an enterprise. It is a quite challenging task as well
for the management of any organization as the data needs to be monitored closely to ensure its
safety and security. There are different categories of information systems which an organization
can use. ERPs can be used by organizations for effective integration of its processes. There are
various benefits ERPs offer to the enterprises which can be used by its management for the
betterment of the enterprise both in the short-run and the long-run.

REFERENCES
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Maetzler, W., Klucken, J. and Horne, M., 2016. A clinical view on the development of
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Rohitratana, K., 2017. The role of Thai values in managing information systems: a case study of
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Sandoval-Almazán, R. and et.al., 2017. Managing information technology development projects.
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Online
7 Little-Known Benefits of ERP Systems. 2020. [Online]. Available through:
<https://www.softwareadvice.com/resources/7-little-known-erp-benefits/>