Developing Leadership & Management Skills: Tesco Performance

This report provides an analysis and comparison of leadership and management, focusing on the application of different leadership and management theories within Tesco. It examines transactional and transformational leadership theories, McGregor's Theory X and Y, and scientific management principles. The report also discusses the key performance indicators (KPIs) used by Tesco, such as employee turnover, sales, growth, cost, and cash flow. Furthermore, it analyzes the impact of leadership and management on the overall organizational performance of Tesco, referencing Maslow's hierarchy of needs to explain employee motivation and satisfaction. The report highlights the importance of leadership and management in problem-solving, decision-making, and driving organizational change and effectiveness.

Developing Leadership and Management Skills

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Analysis and comparison of leadership and management...........................................................3
Management is directing and controlling the organization or group of one or more people that
contribute to accomplishing organizational goal.........................................................................4
Key performance index/ indicator ..............................................................................................5
Organizational leadership and management performance...........................................................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Leadership and management are the basic things which helps the organization in problem
solving and making decision at current time, meeting management needs, managing organization
and improving communication. It also shows how it helps the organization to bring changes by
improving the decision-making and how effectiveness helps overall organization in improving
the performance of organization. There are some basic leadership style – Autocratic, democratic,
transformational and transactional leadership. Some management theories are Fredrick Tylor's
scientific management theory and Gregor's theories of X and Y. Headquarter of Tesco is in
welwyn Garden city, England. CEO of Tesco is Ken Murphy, Founder of this successful
company is Jack Cohen. They have more than 3,36,000 staff working and have around 4673
stores worldwide and 4008 stores in UK and Ireland (Tesco PLC - Statistics and Facts, 2022).
Main objective of Tesco is to deliver the daily use products at very affordable price range and
provide variety of product under single roof to make people's living easier and better quality of
living. It was founded in 1919, East End of London. Giving description about sales structure of
the company and shows how these helped to reach and bring company to be one of the biggest
and widest spread company to be most profitable in this segment of supermarket as
demographically and geographically using the data given.
MAIN BODY
Analysis and comparison of leadership and management
Leadership is the action that leads the people and organisation. Beginning with the
theories of leadership that supported the Tesco to reach the place where it is right now.
Academic theories of leadership that has be put by the company Tesco in their organization are
Transactional theory and transformational theory. It helps in generating new ideas and allows
employee to work with creativity. Leadership helps and influence the individual employee to
work with full effectively and efficiently Leadership is very important part to carry management
to the next level. (Aiello and et.al., 2020).
Leadership theories
Transformation theory:- transformational theory brings openness to new thinking, gives
commitment to actively attentive, trusting the team members and here leader works with the
team to identify that change is needed or not. Creates the vision to guide the changes through

influence and inspiration. It works when behaviour of leaders influence the followers and inspire
them to perform them to work beyond capabilities. There are some elements of transformational
theory which are motivation and positive development. In Tesco it enhances the awareness on
moral standards, giving top position to the priorities. In Tesco there are more than one leaders
and here leaders stimulate followers by setting up interest as the priority to the followers.
Transactional Theory :- Its total focus is on improving the current situation of the organization
by controlling all the activities done by organization. It is the theory in which idea is generated
by managers and allot to employees for something that wants to change. Here, leaders believe
that employees should be motivated whether it is in the form of reward or punishments which is
totally different from transformational style used in Tesco. Main goal of followers is to obey the
instruction of leader where in transformational leader's emphasis values, needs of followers, and
morals. In this focused is on the planning and executing it in the organization whether in
transformational innovation is the main point of focused. In transactional analysis work within
the organizational culture and transformational theory works to bring changes in environment by
implementing new ideas.
Management theories
Management is directing and controlling the organization or group of one or more people that
contribute to accomplishing organizational goal.
McGregor's Theory X and Y which shows that here it takes two aspects and conduct the
practices that are most suitable for the work on which they are charge on in the organization.
Under the theory X it assumes that primary source of employee motivation is monetary, with
strong second one is Security while working. The higher level of satisfaction is needs and self
actualization to the needs and wants for which no one is never completely satisfied (Daneshfard,
2020). According to satisfaction Theory X concentrate that most of the people dislike to work, as
they want to avoid and never wanted to take responsibilities, as in theory Y says that people who
works with full energy are self-motivated and supports to take responsibilities. In relation with
the company Tesco it works as here management like to take theory X approach in running the
business by taking the responsibility to the supervision and direct it to see that ground staff who
work as on floor duties, shelf stacking and sales assistance. In theory X employees are
specialized in some work and then never try something more, in theory Y people try to work in

wider areas and skills of knowledge. Here employees are self-motivated develop their expertise
in different fields.
Scientific management which shows that by optimizing and simplifying /describing job
productivity will increase in the organization. It has four principles which are Science, not rule of
thumb, harmony, not discord, cooperation, not individualism, each and every person to greatest
of its efficiency and prosperity which is totally different from X and Y theory. In the following
part compare how leadership and management is differed from each other and it which way.
Leadership is not only leading subordinates it is the ability that an individual have of motivating
enabling others to contribute the knowledge that they have towards the organization and take
towards the success and effective working. Whereas Management helps Tesco in directing and
controlling the organization or group of one or more people that contribute to accomplishing
their goal.
Here comes a part where PIS (planning information system) gets involve it is a important
element for any business but especially for Tesco it is important as it needs various information
related to the product source, Needs and demand of the product and services, market
development as it is important for customer as well as for business to deliver the best value
products and services.
Key performance index/ indicator
KPI which are being used by Tesco uses approach are Employees are:-
Employee turnover :- Employee turnover means what are the numbers of employee who joined
and leave the organization over a certain period. Generally retention rate of 90 % or more is
considered as good for the company. Tesco has staff turnover of 29.9% but not specific figure.
Tesco uses the quality of employee and strength towards their work so employees feel positive,
and they even recommend other to work with Tesco.
Sales :- In any organization sale plays most important part to stay in the market which shows at
what position organization Is. Tesco has done sales of 49.9 billion pounds in 2015/16. Key
element of Tesco's success are both volume of the business and increasing in customer shows the
growth in the customer base.
Growth :- Growth in business occurs when employees, owner and outsiders and customer
influence the company to go towards the success. Growth could be measured by some of the
certain parameters like increase in area, increase in volume, decrease in wastage etc. Growth

analysis of the organization tries to focus on the profit and growth of the organization. True and
accurate profit based measurement, shows how much the amount of revenue which remains as a
profit for the given period given of time after excluding all the expense of the company tax. After
all Tesco has profit margin as 54.8 billion pounds in the market. As it used the strategy called as
greenfield strategy (to enter into new market form local market).
Market share price when it was launched in the market was 94.67p higher it touched the price
of 488p in October 2007 and now it is 266.78p and increasing day by day (Tesco PLC, 2022).
Cost :- It is a money that company uses in different perspective for the purpose of creation.
There is a sheet which is known as cost sheet which is being used which is basically used for
setting up top priorities out of strategies and provide a clear direction to the business in the form
of “balanced scorecard and strategy map” there are five perspective that is used but Tesco are
grown sale, Maximize the profit and managing our investment, customer's perspective, be
responsible, fair and honest and operational perspective. Previously strategy Tasco was using is
Steering wheel strategy helps to measure the performance of organization. Tesco has divided
local Steering wheel which helps to measure the performance of local stores individually. To
breakdown more, Tesco gone through six simple indicators which are sales, profit, cash flow
operation, recommendation of customers, make work place great by which employee
recommends and building trust partnership (SPARKS, 2018). Which majorly helps Tesco to
achieve growth in UK market, the kind of expansion in the UK market Tesco is the only leader
who own the supermarket in whole UK latest by 2021.
Cash flow :- Cash flow is a simple financial statement that shows the data regarding sach
inflows from ongoing activities and certain investment. Cash flow from operation generally is
the expenditure which is made by every company to make ordinary or temporary part of
expenditure for operation. Tesco generates around 2,279 million pound from operations and
having strong cash flow is much-needed to keep business running and also allows reinvesting.
Tesco makes a group sales of around 54.8 billion pounds in which it has 2,825 million pounds of
profit it has retail free cash flow of 2,277 million pounds in 2021 (Key facts, 2022).
Organizational leadership and management performance
Leadership and management impact on the relation of overall performance of business. Human
generally shares some needs of which are necessary for them to fulfil. Increasing the companies

success by briefing about maslow's hierarchy of needs discuss that human need decides the
behaviour of the employee working in the organisation. It is a theory that motivates the
employees which states basic five components which are :-
Psychological needs These are the needs of human being which helps internally and makes
everyone feel satisfied from internal feelings and can take care of healthy mental state, by
providing the salary which complete their basic needs which is the most important need of the
person who is working in organization because if basic need are not being fulfilled then
employees would not feel happy to work with organization. There are basic three psychological
needs which are autonomy, relatedness and competence which lead drivers of employee in job
satisfaction and engagement.
Safety and security needs is the next most important need of human that protection from theft
and violence environment they are working in health security as well as financial security.
Employee retention means safe working environment which shows employer cares about their
employees well-being. It is clear that employee who feel safe stays more loyal and stay longer
with the organization. Safety plays very important part in productivity of employee as if there is
no safe environment then employees will be fright and all time anxiety. Workplace safety
hazards is a potential source of make employee feel safe to be in organisation.
Esteem:- Which includes Respect, self-esteem, status, recognition, strength and freedom. Tesco
provide recognition to each employee who are working hard, in this certain organisation strength
which every person has but allowing them to work is most important thing for organisation to
keep employee happy and satisfied. Confidence is important in business as it is necessary to have
confidence to deal with all the uncertain conflicts in business and to improve the communication
skills in business. It makes person feel happier at work and it helps to be a better leader and
manager.
Self actualization needs sometime it is called as self fulfilment Needs which occupy the highest
point in maslow's theory. How Tesco uses it and provide some important basic need of the
employee which satisfy them to work as it provides regular monthly salary on time to the
employees some essential facilities that organization use to meet the psychological need of
employee are pension, sickness leave, allow them to join union to fell secured and as security,
ask them to work as a team and in a group that meets their social need as well as generate the
opportunities for promotion and the most important Feedback system. After doing all this

activities' information regarding the measurement of performance in business in mandatory
because after that only management team will consider that they should continue with all these
or there is need of change in some part of planning and executing by the functional team and
team will get it by feedbacks and follow up on working behaviour of the employees (Guo, 2019).
Way to manage the team work among all these the style which is mainly followed by Tesco.
Both the aspect Leadership and management make thing work by organizing people in two
different ways. In which leadership is the ways of showing new direction to the group in which it
spearhead and Management helps in controlling and directing resource that they are getting or
the people in the group according to the values and principles.
CONCLUSION
Based on the above discussion, academic theories and models learnt about how these
helps the organization to improve productivity. As studied there are certain studies from which
Tesco used only those which are useful for them. From above understood that leadership helps
and influence the individual employee to do best of their knowledge and management helps in
controlling and directing resource that they are getting or the people in the group according to the
values and principles. From the above discussion it is understood that Tesco used some
leadership technique which are Transformational and transactional theory and management
theories McGregor's X and Y and Fredrick Taylor's theory. It has been also discussed that Tesco
used key performance index as “Cost analysis, employee turnover market share” which helped
Tesco to arrange top priorities at fist and then others to get clear direction towards work. After
the explanation of management theory understood the KPI which has been used by Tesco in their
organisational environment and its impact. Afterwards understanding KPI's understood how
employee will get motivate and what will be positive aspect of it and then discussed about the
maslow's theory As of late it has been confronting that the technique that Tesco used which is
customer oriented/ customer intensive market to increase the sale and profit at correct time.
Additionally, as discussed before about the profitability of Tesco and Sainsbury came to know
that Tesco is doing much better than Sainsbury. Based on the above information Sainsbury is
ahead in terms of Debt-to-equity.

REFERENCES
Books and Journals
Aiello and et.al., 2020. Tesco Grocery 1.0, a large-scale dataset of grocery purchases in
London Scientific data. 7(1). pp.1-11.
Awadari, A.C. and Kanwal, S., 2019. Employee participation in organizational change: A
case of Tesco PLC. International Journal of Financial, Accounting, and Management, 1(2),
pp.91-99.
Guo, L. and Wang, Z., 2019. Ratio analysis of J Sainsbury plc financial performance
between 2015 and 2018 in comparison with Tesco and Morrisons. American Journal of Industrial
and Business Management. 9(2). pp.325-341.
Hamill, J., 2020. Coronavirus: How Tesco, Primark, Sainsbury's and other retailers are
reacting to Covid-19. The Herald (Glasgow, Scotland).
Moura, M.B.L.D., 2021. Equity Research in Food & Retail Industry-TESCO PLC
(Doctoral dissertation, Instituto Superior de Economia e Gestão).
SPARKS, L., 2018. Tesco’s chain management supply 07. Logistics and Retail
Management: Emerging Issues and New Challenges in the Retail Supply Chain. p.183.
Sultan, A., 2020. Effective leadership and its impact on organisational performance: retail
industry (Tesco) (Doctoral dissertation, University of the West of Scotland).
Daneshfard, K. and Rad, S.S., 2020. Philosophical analysis of theory x and y. Journal of
Management and Accounting Studies. 8(2).
Online
Key facts 2022, available through <https://www.tescoplc.com/about/key-facts/>
Ratio Analysis Of Tesco And Sainsbury With Comparison, 2022 available through
<https://sourceessay.com/ratio-analysis-of-tesco-and-sainsbury-with-comparison/>
Tesco PLC - Statistics and Facts, 2022 available through
<https://www.statista.com/topics/3807/tesco-plc/#topicHeader__wrapper>
Tesco PLC, 2022 available through <https://www.londonstockexchange.com/stock/TSCO/tesco-
plc/company-page>