Leadership and Management Concepts: Tesco PLC Analysis - Unit 4

This report provides an analysis of leadership and management concepts within Tesco PLC, a British multinational retail company. It differentiates between the roles of managers and leaders, highlighting their responsibilities in organizational situations. The report discusses the application of theories such as Chaos Theory and Management by Objectives to Tesco's operations, emphasizing their impact on growth and sustainable performance. It concludes that Tesco's success is attributable to effective leadership and management, recommending the adoption of transformational leadership and a flatter management structure for future improvements. This document is a valuable resource for students studying leadership and management principles.

Leadership and Management Concepts 1
LEADERSHIP AND MANAGEMENT CONCEPTS
Student Name
Professor’s name
Institution
Course
Date

Leadership and Management Concepts 2
Leadership and Management Concepts: Tesco PLC
Introduction
Tesco is a British multimillion company founded by Jack Cohen 100 years ago. It is a
retail firm dealing with groceries and other general merchandise across Asia and Europe.
Over the years to the company has expanded its operations to include petrol stations,
supermarkets, hypermarkets, and convenient shops. As a result, Tesco has grown to become
one of the largest retailers by revenues, which amounts to £57,491 million as of the financial
year 2017/2018 (Tesco, 2018). Undeniably, it is the groceries market leader in the UK with
its market share in Ireland and Hungary being above 20%.
The management structure of the company is arranging in three layers in a hierarchal
manner. First in the hierarchy is the top level management. This comprises of executive board
which is led by the President of the company Dave Lewis. Other management leaders in this
level include the non-executive chairman, John Allan, the chief finance officer, nonexecutive
directors and the executive committee of 9 members. Second in the hierarchy of management
is the mediate level which is occupied by various vice presidents, managers, and their
assistants. Mainly they are responsible for running all the operations including HRM,
marketing, public relations, and financial management. At the base of the management
structure is the base level which hosts regional managers, store managers and all other
employees of the company (Tesco, n.d.).
Role of Managers and Leaders
The two terms are mostly confused to mean the same, but there is a significant
difference in terms of their roles in an organization. However, a manager is a person
responsible for administration and control of an organization based on its ethos and policies
while a leader is a person who commands or direct a group of people to achieve a vision
he/she has created in an organization (Lunenburg, 2011). For instance, Tesco has both
managers and leaders in its organizational structure.
Roles of managers
Managers are tasks with different duties which are categorized into informational,
interpersonal and decision roles. Under informational roles a manager is mandated with
liaising with the senior management, completing all administrative works, evaluating the
performance of employees and running the daily operations of the company. At Tesco,
managers are primarily the agents of communications liking the employees to the top level
management as well as overseeing the daily operations and implementation of company
policies. Under the interpersonal roles categories, managers are tasked with staffing, a
delegation of duties and motivation of employees to sustain a consistent performance and
production.
Finally, with the decision roles, managers are limited to what types of decisions they
can make. Ideally, managers can make administrative, and goal setting decisions in an
organisation. Although there are instances where they can make financial decisions for the
company, the top management comprising of a company’s leadership should consent the
decision before it is implemented (Lunenburg, 2011). Essentially, managers propose the way
forward in terms of operations and administration but may lack the authority to give the final
decision about the issue.

Leadership and Management Concepts 3
Roles of Leaders
In any organisation, the roles of a leader are at every level of the management.
However, leaders are primarily responsible for reconciling and integrating personal and
organizational goals. Secondly, a leader solicits support from the staff to achieve a common
goal of the organisation. Finally, as a leader, one is mandated with representing an
organisation and providing philosophical and directional guidance to their followers, i.e., the
employees of the company. At Tesco, there is no apparent difference between leaders and
managers as they both perform the same roles. However, the founder is considered the leader
since his visions are still being pursued by the management of the company (Zhao, 2014).
In essence, management and leadership are two distinct and intertwined concepts. For
instance, leadership is needed for effective management to existing (Lunenburg, 2011).
Notably, leadership is considered to be the potential to influence a group, i.e. employees to
accomplish organizational goals while management is merely the process of laying down the
structures and enforcement of policies to accomplish the set goal. Considering the origin,
leadership originates from the authority given by followers while management comes from
the acquisition of a managerial position (Lunenburg, 2011). Although a manager can be a
leader, not all leaders can be managers. Finally, management is seen as being a more stable
component of an organisation whereas leadership is temporary and depends on the duration
the project or program they are leading lasts. Generally, leadership can be described as being
an art while management remains to be a science that needs planning, logic, and tactics of
implementing policies and running operations (Stacey, 2012).
Roles of Leadership and Management in Organizational Situations
The roles of management and leadership sound simples, but anybody who has been in
any of the two knows that in reality, it is complicated. In different situations, the roles of
leadership, as well as the management, varies significantly. For instance, at Tesco, during a
crisis, the management moves to address it by implementing the adopted policies in the
organization. In the same context, leadership will not be tasked with addressing it but rather
creating a sense of understanding between the conflicting parties to avoid a relapse of the
same in the future. In this regard, leadership serves as a vehicle for mediation and guidance to
cool down the conflicting parties (Stacey, 2012).
Roles of Leadership
In leadership, the challenges are many and what worked today may not work
tomorrow. Therefore leaders have to be at the center of innovation and invention of new
strategies that can steer an organisation towards success. Primarily leadership has four
significant roles it plays in an organisation. First, leadership creates inspiration and trust
among followers. Whenever a company struggles to align its staff towards an organisation
goal, it is through leadership that such can easily be achieved. Although management too can
be used to achieve this milestone, trust issues might limit the chances of success (Metcalf &
Benn, 2012). Second, leadership creates a vision for everyone being led. In situations where a
company needs to focus on a long-term goal, it is only leadership that can influence the staff
to perceive the goal as achievable and worth trying to accomplish (Lunenburg, 2011).
Third, leadership is used to execute corporate strategies in organisations. For instance,
it is through the leadership of Dave Lewis that Tesco has been able to implement its
diversification strategy to cover nearly retailing of all merchandises in Asia and Europe.

Leadership and Management Concepts 4
Lastly, leadership builds motivation, teamwork spirit and grow the potential of a workforce to
enable optimal productivity. Ideally, it is only leading by example that will encourage staff to
carry on with their respective responsibilities and work towards achieving organisational
goals (Metcalf & Benn, 2012).
Roles of management
Although leadership is still a component of management, the roles are entirely
different and distinct. First management is tasked with organisational planning. This involves
making arrangements for daily operations to be undertaken and ensuring resources are
allocated according to needs (Serra & Kunc, 2015). Second, it is the role of management to
organize processes, staff, and resources to keep an organisation running and sustainable in the
long run. Although leaders too can organize, it is the work of the management to lay down
the procedures and protocols to be adhered to while undertaking various activities. Based on
classical management theory, planning, coordinating, controlling, organizing, staffing and
directing are all responsibilities of the management (Mahmood et al., 2012). Unlike
leadership, management relies on established policies and regulations rather than
personalities and qualities. Furthermore, management is based on positions while leadership
is based on the qualities of a manager or any other person in charge of subordinates in an
organisation. Therefore, it is correct to presume that managers are leaders, but leaders are not
managers.
Application of Theories to the Organisation for Growth and Sustainable Performance
Organisations have changed and are continuously evolving to adapt to the new
environments that are driven by technology. Often, scientific theories try to study and
elaborate on the complex behaviours that organisations show both in leadership and
management (Stacey, 2012). For instance, the evolution of Tesco from a simple grocery store
to a multimillion retail company depended on studying the behaviour of consumers, markets
as well as the dynamics of management.
Chaos Theory
Chaos theory is a scientific approach that presents mathematical aspects in
management to work with systems characterised by complexity, unpredictability, dynamic
and non-linear (Olmedo, 2010). Mostly, the systems are far from equilibrium, and constant
change makes it almost impossible to foresee what happens next as the effects of external and
internal environments control the operations to a larger extend. This theory, in particular, is
crucial in the management of Tesco in different ways. First, the concept helps in the
recognition of the presence of uncertainty. As a result, the management tries as much as
possible to use the available information to prepare for any changes in the futures and
collaboratively instigate strategies that best fit the unpredictable environment. Consequently,
growth and sustainability in the performance of the company have been managed effectively
through the consideration of this theoretical approach to leadership and management.
Second, organisations utilize Chaordic system thinking to unify the unpredictability of
the environment with the orderly patterns that usually exists (Olmedo, 2010). This has made
Tesco adopt a dynamically adaptive system that responds effectively to any dramatic changes
that may occur unexpectedly within the company. Lastly, the chaos theoretical framework
has been applied to the organisation in understanding the need to design strategies that handle
non-linear and complex management problems within an organisation. Essentially, growth

Leadership and Management Concepts 5
and improvement in performance, in the company has been supported by the preparation
done to handle unexpected occurrences in the market based on the concepts of chaos theory.
Management by Objective
This theoretical strategic management framework is one of the most popularly used
by organisations. Tesco has successfully implemented it in all its operations, and tremendous
improvements in the performance of both employees and the company been realized. The
approach takes into consideration the goals of a company and aligns it to match individual
goals (an aspect of leadership) in order to stimulate a sustainable performance (Hayes, 2019).
Notably, the concepts are implemented in five steps.
First, organisational goals are received. Second, the objectives of the employees are
set depending on performance monitoring systems used in their respective divisions in the
company. Third, the progress of achievements is closely monitored by the management.
Fourth, an evaluation is carried out regularly to establish if both organisational goals and
employee objectives have been attained (Hayes, 2019). Lastly, a reward system is
established, and the best performers are realized and appreciated. At Tesco, this management
concept has successfully been adopted and incorporated in their strategic management
planning that has seen the company grow exponentially to become the leader of the retail
business in Asia and Europe. Furthermore, the overall performance of the company has
increased, and with the strategy still in place, the same trend in performance is expected to be
sustained for longer periods.
Conclusion
With Tesco being one of the largest retailers in the European market, its success is
owed to the leadership that has ensured efficient management. The ground manager leading
the branches and stores across the different countries have shown resilience and exemplary
leadership and managerial skills that have fuelled the company’s growth and improvement in
performance. Although the extent of their impact is evident in the company, further
engagements and implementation of new approaches to leadership and management are
needed. Particularly, Tesco needs transformational leadership to replace the existing
transactional leadership.
Moving forward, the company should consider forming a flat management structure
rather than a hierarchal arrangement that slows the execution of critical operations in the
company. Furthermore, decision making is slow in the organisation due to the procedures that
need to be followed and approvals that need to be made by the senior and mediate level
management. When this is correctly executed and met the company will have a free flow of
information, and it will enhance interrelations between the employees and the top level
management thus addressing company related issues will be easier and faster.

Leadership and Management Concepts 6
Reference List
Hayes, A. (2019) Management by Objectives (MBO) [online]. Available from:
https://www.investopedia.com/terms/m/management-by-objectives.asp [Accessed 2 April
2019].
Lunenburg, F. (2011) Leadership versus management: A key distinction—At least in
theory. International Journal of Management, Business, and Administration. 14(1), pp. 1-4.
Mahmood, Z., Basharat, M. and Bashir, Z. (2012) Review of Classical Management
Theories. International Journal of Social Sciences and Education2. 2(1), pp. 513-522.
Metcalf, L. and Benn, S. (2012) Leadership for Sustainability: An Evolution of Leadership
Ability. Journal of Business Ethics. 112(3), pp. 369-384.
Olmedo, E. (2010). Complexity and chaos in organisations: complex management.
International Journal of Complexity in Leadership and Management. 1(1), pp. 72-82.
Serra, C. and Kunc, M. (2015) Benefits Realisation Management and its influence on project
success and on the execution of business strategies. International Journal of Project
Management. 33(1), pp. 53-66.
Stacey, R. (2012) Tools and techniques of leadership and management: Meeting the
challenge of complexity. 1st ed. New York: Routledge.
Tesco. (2018) Preliminary Results 2017/18 [online]. Available from:
https://www.tescoplc.com/media/474627/prelims-results-1718.pdf [Accessed 1 April 2019].
Tesco (no date). Tesco's Board and Executive Committee [online]. Available from:
https://www.tescoplc.com/about-us/board-and-executive-committee/executive-committee/
[Accessed 1 April 2019].
Zhao, S. (2014) Analysing and Evaluating Critically Tesco’s Current Operations
Management. Journal of Management and Sustainability. 4 (4), pp. 184-187.