BA Leadership: Leading and Implementing Workplace Change at Tesco PLC

This report examines Tesco PLC's history, external factors impacting its performance, and strategic changes driven by leadership. It analyzes the company's evolution, including its expansion, acquisitions, and adaptation to market trends. The report delves into Tesco's leadership styles, particularly the participative or democratic approach, and its influence on change management. It explores how organizational culture affects the implementation of change programs, considering the impact of political, economic, social, technological, environmental, and legal factors. The report also discusses Tesco's corporate social responsibility initiatives and its response to changing consumer behaviors and preferences, including the adoption of technologies like RFID and online shopping. Finally, it highlights key milestones in Tesco's history and the leadership transitions that shaped its growth and adaptation to a dynamic retail landscape.

Running head: LEADING AND IMPLEMENTING WORKPLACE CHANGE
Leading and implementing workplace change
Name of the Student
Name of the University
Author Note

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Executive Summary
The report has been prepared to discuss Tesco Plc one of the most renowned retail stores of
the United Kingdom. The report gives detailed information regarding its history and how
external changes have affected the company. It also provides a clear picture of the strategic
changes which the company undertook and the leadership style followed by the company
over the years. The organizational cultural impact on the company’s change management
programme has been discussed as well in the report.

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Table of Contents
Introduction:...............................................................................................................................3
Analysis of recent History of Tesco Plc:....................................................................................3
External Analysis.......................................................................................................................5
Strategic changes according to leadership style.........................................................................7
Evaluating the impact of Organizational Culture on the program of change management:....11
Organizational Culture and Change Management Process......................................................12
Impact of Organisational culture on the change management program..................................12
Conclusion................................................................................................................................16
References................................................................................................................................16

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Introduction:
Tesco Plc is a multinational company which has established itself as a big brand in
offering various retail services to its customers. It falls in the category of leading
supermarkets located in the United Kingdom, which provides its customers with both food
and non-food retailing services. It has its headquarters situated at Hertfordshire in England. It
has seven thousand stores located worldwide. Tesco Value and Tesco Finest are two popular
food brands of Tesco Plc. It offers its customers an online grocery store. Tesco Bank, which
is the subsidiary of Tesco Plc, provides insurance and bank-related services to its customers
in the UK. Tesco Mobile network offers various telecom services to its customers. The
company holds more than fifteen per cent market share in Great Britain, thus becoming its
leading food retailer. It has two hundred and fifty-seven superstores in countries like
England, Wales and Scotland. It operates in seven countries covering both Europe and Asia.
Analysis of recent History of Tesco Plc:
Tesco was founded by Jack Cohen, who started to sell excess groceries in a food stall
at London in year 1919 (Telegraph.co.uk 2019). The brand name Tesco came into existence
in the year 1924 when Jack Cohen created the term TESCO by combining the initial letters of
the tea supplier’s name, Thomas Edward Stockwell as TES and initial two letters of own
surname as CO ( The Fact Site 2019). In the year 1929, it started a store at Edgware, which
sold tea. Tesco witnessed business expansion during the next decade. In the year 1934, it
became the trendsetter to build warehouses for food items. Later on in the year 1947, it was
traded in the stock exchange in London (Business Insider 2019). The same year it opened its
first self-service shop at St Albans. Tesco business started growing at a fast rate, with it
acquiring more than five hundred stores. After that in the year, 1956 Tesco introduced its
operations in the supermarket for the first time at Maldon where it sold meat and cheese. By

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1960, it was not only offering food items but also diversified its product range by offering the
sale of home electronic items, clothing and telecom services at the stores. In the year 1968, it
introduced the concept of a superstore (Chung et al. 2014). In the year 1973 Tesco
established petrol station for the first time in the United Kingdom. In the year 1985, it
introduced a healthy range for its customers. In the year 1987, it took over forty supermarkets
belonging to Hillards Plc. In the year 1992, it established its Metro store followed by its
launch of Tesco value range in the year 1993. The market expansion of Tesco Plc was
strengthened by the acquisition of chain of supermarket of William Low in 1994 and Tesco
launched its Club card a year later (Tescomobile.ie. 2019). Later on in the year 1997, it
launched Extra store. In 1998, Tesco Finest range was introduced which offered luxurious
products to its customer base (Companies History - The biggest companies in the world
2019). During the 2000s, it provided its customer online shopping service and bought about
eight hundred and seventy one-stop shopping stores. In 2003, Tesco established its own
telecommunication division in the UK. The same year Tesco took over Kipa’s supermarket
chain located in Turkey. Tesco also undertook the acquisition of Administered in 2004. Tesco
also entered into fashion retailing business. Tesco also launched banking services for its
customers. Tesco opened Fresh & Easy store during its entry to the markets of US. In 2005,
Tesco took over Safeway stores belonging to Morrisons after its dissolution and launched a
carbon-free store for the first time in year 2010. In 2012, ‘Everyday Value brand’ was
introduced, replacing the earlier value range of Tesco. In the year 2012, Tesco decided to
wind up its operations in the Japanese market along with the US market. In the year 2013
dotcom store service was offered by Tesco to enhance the online shopping by customers.
Yucaipa group took over about one hundred and fifty stores of Tesco. Tesco sold tablet
computer known as Hudl for the first time in 2013. Tesco decided to install a face-scanning
system at Tesco owned petrol stations in the United Kingdom. Alphamega superstore started

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selling a variety of Tesco products during this time. Tesco began to make a plan around the
year 2014 to extend its business to the smartphone industry. The brand ‘Healthy Living’ was
initiated by Tesco in the year 2014 (the Guardian 2019). In the year 2015, Tesco made an
agreement with TalkTalk to sale its Blinkbox service business. In the year 2018, Tesco
merged with the Booker group (Agency 2018).
External Analysis
A large number of macro-environmental factors have affected the performance of
Tesco Plc. The company should consider these external factors during its conduct of
operations. Tesco’s performance has been affected by political elements of the country where
it operates. Tesco operates globally, covering a large number of countries. It has its presence
in a large number of European countries like the United Kingdom, Turkey, Ireland, Poland,
Hungary, Slovakia, Czech Republic and others. Tesco has to follow the political conditions
laid down by the European Union. Tesco has its stores in Asian countries such as Malaysia,
Taiwan, South Korea, Japan and Thailand. Since Tesco Plc operates in a large number of
countries, it has to abide by all the legislative and political schemes of every nation. The
operation of Tesco is affected by various factors such as the tax structure of the country,
economic condition, unemployment rate, political uncertainty and others. Tesco imports
certain materials from East Asia and China, so an increase in import duty will have a negative
impact on the company. Some authorities in the UK wanted that ‘Tesco Tax’ should be
imposed upon the supermarkets of Tesco some time back. However, the government body of
the United Kingdom did not agree with this, thus affecting Tesco positively. The government
would always want a boost in job availability (Ivoryresearch.com 2019). Tesco being a large
retail store, would be able to provide job opportunities to a large number of people.
The performance of Tesco Plc is influenced by economic factors, as well. The
demand and supply rate is affected by various economic conditions like inflation rate,

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unemployment rate. If the unemployment rate rises in the country of operation, it will have an
adverse impact on the demand of consumers, and hence production will get affected.
However, Tesco is a multinational company operating in various countries, its main area of
operation lies in the United Kingdom. The performance of the food industry in the UK and
economic risks there have a massive impact on Tesco. The rise in labour rate in the UK has
been a significant concern. The rise in borrowing cost has been another area of interest for
Tesco.
Social factors also have an influence on Tesco’s operations. There has been a
profound change in the trend of shopping done by consumers nowadays. Many of them want
to go for online shopping. Tesco offers online shopping facilities to its customers and
provides one-stop shopping facility, which is preferred by most customers today. According
to a survey conducted, the majority of the shoppers in the United Kingdom fall in the
category of loyal shoppers. Therefore, Tesco should develop a more effective marketing
strategy to retain this customer group. It should focus on business expansion in organic food
items to target health-conscious customers. Attitudes and preferences of consumers towards
food items are changing because of which the company is bringing changes in the product
mix and going for retail services of a variety of organic products for the customers
(telegraph.co.uk 2019).
Technological factors have a significant impact on the performance of Tesco Plc.
Tesco introduced retail technologies to improve customer facilities. RFID (Radio Frequency
Identification) technologies began to be used by Tesco to enhance the customers’ store
experience (Rfidsolutionsonline.com. 2019). This technology helps the story to keep track of
its stock spontaneously and replenish it as per necessity. Tesco launched its own payment app
PayQwid that the customers can use in their mobile phones for making payment and gain
loyalty points as well. Tesco Ltd launched a mechanism by which the customers can do

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tagging of products while shopping. It helps to reduce the cost of labour along with saving
time. Tesco uses the self-checkout machine system. It also introduced the ECR (Efficient
Consumer Response) system. The distribution system of Tesco has dramatically improved by
its adoption of the Electronic Fund Transfer System and Electronic Point of Scale.
Companies have to conduct corporate social responsibilities to build the right image
among the customers. Tesco is taking up steps to ensure that it minimises energy
consumption and does not emit greenhouse gases. Tesco has taken up the responsibility of
recycling plastic bags. It is inclined towards the use of various types of renewable resources
and intends to lower down the carbon footprint (Telegraph.co.uk 2019). Many countries in
Europe provide some tax benefits to those organisations, which adopt eco-friendly strategies.
Tesco has developed various ways to benefit society. Being in the retail sector, Tesco has an
excellent waste management system and contributes towards minimising environmental
pollution.
A number of statutory factors influence the activities of Tesco. The performance of a
business is affected by changes in the law system. Various policies and regulations of each
country affect Tesco’s performance. Tesco being in the retail industry, has to abide by the
policies set up Food Retailing Commission. Tesco had also experienced some legal action
due to some unfair practices regarding accounting and misguiding the shareholders. In the
year 2016, there was grievance among employees of Tesco about the issue of them facing
discrimination based on age as well as gender. Tesco has to take account of the
discrimination law. It should consider safety law and health law as well. It has to conduct its
operations by taking consumer protection laws into account.

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Strategic changes according to leadership style
In the year 1919 Jack Cohen founded Tesco Plc. The business witnessed a good
expansion under the leadership of Cohen. Sir Terence Patrick “Terry” Leahy joined the
company in the year 1979, holding the post of marketing executive. Gradually through his
skillset and excellent contribution to Tesco Plc, he went on to become the Chief Executive
Officer (CEO) of the company in the year 1979. Since the time Terry Leavy took over the
position of the chief executive officer at Tesco Plc, the company has been able to achieve
vast expansion under his visionary leadership. Under the direction of Terry Leahy, the
company followed the participative leadership structure, which is also called democratic
leadership. Tesco offers its workforce a competitive salary and provides them ample of
opportunity along with the necessary training required. Tesco Academy was established by
Tesco Plc to provide the employees with proper skills related to technical and management
aspects. Tesco Plc gives performance reviews to the employees, which helps them to identify
their problems and enhances their performance. The company feels that by keeping the
workforce satisfied, it will be able to achieve its goals more effectively. The employees are
allowed to give their views in the decision making process and offer its customers high
quality services due to the efficient service provided by its employees.
The organisational process can be tackled by appointing appropriate leaders with
respect to their departments. The democratic leadership of Tesco Plc makes it possible to
follow an active communication channel that reaches every level of the organisation. Tesco
Plc has succeeded in its operations due to the Terry Leahy’s democratic leadership quality,
which led to the flexible working atmosphere and desired job role. This type of leadership
style has helped Tesco Plc to remain competitive in the market. Tesco feels customers are the
priority focus and, therefore, has taken up various ways to ensure customer satisfaction is
achieved at the highest level (Mollah 2014). The management style of Tesco makes sure that

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proper communication is established between the company and its customers so that the
company takes the customers’ views into account. Tesco thinks that having negotiations will
be another way to solve the problems. It seeks ways to ensure that it maintains a healthy and
cordial relationship between the employees and the company and helps to resolve the conflict
in case if it arises (Jenkins and Williamson 2015). Tesco believes in addressing the
complaints by the customers. It works to enhance customer welfare. Terry Leah focussed on
developing leadership skills in all the departments of the organisation. He has followed the
system of flat management style in order to empower every individual associated with the
company. He never supported the idea of having a single leader, which he believed would
lead to autocratic leadership in the organisation. Tesco Plc also adopted local leadership as it
found it suitable for the customers. The company has always followed a realistic approach
with dedication to ensure that the goals are attained. The company follows such a business
policy, which provides that the products are sold at an affordable price without hampering the
quality.
Due to flexible leadership style, Tesco Plc has been able to expand its business to
other parts of the world and establish itself as a famous multinational company. Besides this,
the company has now started its business in a variety of non-food product items other than
the food products. It had launched superstores by the brand name Fresh and Easy when it
entered the US. Tesco Plc took ways to give incentive points to the customers through a
loyalty card known as Tesco Clubcard. Tesco has always thought ahead of time. Back in the
year 1995, Tesco launched an online shopping service to its customers. In the year 2006,
Tesco entered the telecommunication industry by doing a business venture with O2. After
that, it launched mobile phones. It conducts its telecom operations in Ireland, Slovakia and
the United Kingdom. It offers telecom service to its customers at a low rate and expanded its
business area by giving insurance facilities to its customers at a flat rate as a way of thanking

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them for showing their loyalty towards the company. The company also offers electronic
items by the brand name Technika. It provides electronic goods to its customers at a very
affordable price. Tesco has also built up a partnership with other companies in the UK to
come into the petrol station business. Tesco has been able to grab a significant position in the
global market. The participative leadership form of Tesco Plc due to its flat structure has
helped it to be flexible enough during its operation. Rapid growth in the organisation has
been possible only due to the flexible nature of the management and is highly dedicated to
provide support to its employees in getting their desired job role, working hours and other
necessary requirements. Effective management policies help Tesco Plc to adopt strategies to
keep its customers satisfied and gives the company a competitive edge in the market. Tesco
under the aggressive leadership of Terry Leahy was able to become a great name in the
supermarket business. After his fourteen-year stay at Tesco Plc, Leahy resigned in the year
2010. After Terry’s resignation, Philip Andrew Clarke went on to become Tesco’s CEO and
stayed there till the year 2014 (the Guardian and Finch 2019). However, under his leadership,
the performance of Tesco Plc was not much impressive. According to many experts, Tesco
was losing a lot of market share to its competitors during his stint, and the employees were
also losing confidence. Various issues like horsemeat scandal, shortage in sales, profit
warning and accounting scandal worth £250 million and several other legal issues was faced
by the company (Yamoah and Yawson 2014). Dave Lewis took up the position of chief
executive officer of Tesco Plc from the year 2014 after Philip Andrew Clarke took
resignation from the company. In the year 2016 Tesco Plc faced problems after its employees
started taking legal steps for issues related to them facing discrimination based on gender and
age (the Guardian 2019). This intensified after Tesco Plc started reducing its wages for
people working in the weekend as well as night shifts. Tesco faced criticism since it reduced
the pay cut and benefits package for the people above 40 years old.

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Tesco Plc needs to develop an efficient employee satisfaction model to keep its
workforce satisfied like early days. Such a model is also known as Pride System. The
leadership should look into ways of keeping its staff motivated to enhance their performance
and productivity. The employees should be working in a healthy working environment. Open
working space should be provided to employees. They must be given proper recognition and
incentive scheme for their performance to motivate them. The employees must be asked to
participate in the decision making process to put forward their ideas and suggestions. This
will create a sense of ownership among the employees of the company. Employees must be
given the opportunity to enhance their skills by undergoing various training and development
programmes. Tesco can follow the ADKAR model. This model involves making the people
aware about the necessity for change, desire to implement the desired change, knowledge
about the process of change implementation, ability to take necessary steps to display proper
skills and reinforcement process.
Evaluating the impact of Organizational Culture on the program of change
management:
Organizational culture can be stated as the structure of norms, beliefs, values,
assumptions and attitudes that acts as important factors as the workers of the organization
does their job or behave inside the organization. In simple words, it said as the culture of
organization responsible for doing job in the organization in a typical way (Babajana and
Webber 2015). There are key elements that gives an essence of the organization’s culture of
Tesco plc and they are following:
Risk taking and innovation: the employees of the organization are encouraged to
structure their innovative idea and the risk associated with the innovative idea.

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Attentive of the details: the employees expected to pay attention to every detail of
their job, analyze and exhibit the precision.
Result Orientation: The management of the organization focuses on the final product
or services and not merely on the process to achieve the product.
People Orientation: When management takes any decision then the impact of it on the
employees of the organization considered as people orientation.
Team Orientation: When job assigned in groups rather than working as individual.
Aggressiveness: Aggressive nature of an employee towards any assigned job rather
than being relaxed and delaying the work.
Stability: this depends upon the nature of maintaining the stability of the organization with
respect to growth.
Each of the above element is important for every organization to exist and to maintain
their continuation in the market. However, the implication of the elements can be from low to
high that depends on the purpose and nature of the business. Tesco gives importance more or
less to all the key factors (Brannen et al. 2013).
Organizational Culture and Change Management Process
Organizational culture and change management always goes hand in hand. When any
change management process adopted in the organization, then the culture of the organisation
has to change accordingly (Chung and Choi 2014). The adaptation of change management on
the organisation can bring success and more performance that is efficient. The managers of
Tesco considers organisational culture and then designs the change accordingly.

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Impact of Organisational culture on the change management program
Tesco plc has initiated changes on their organisational culture. The impact of their
decision on the change management program stated below.
Culture change in the organization can improve the performance of key variables like
ROI (return on investment), innovation, employee satisfaction & customer satisfaction and
sales growth. Different strategies needed to implement the cultural changes in the
organisation. It is important to manage as well as administer the changes properly on the
organisational culture throughout the period (Dewick and Foster 2018).
Tesco plc has brought the cultural changes by exploring the important beliefs &
values of the employees and by communicating the change of process by introducing the new
behavioural norms in the organisation. Tesco has divided their organization change into two
categories: how the organizational change affects the managers (manager’s top view) and
how the organizational change affects the employees there (employee bottom-up view). The
result of these changes are ultimately going to affect the clients and the term known as
individual change management. Employees are the first most point of implementing any
change in the organisation. They are the basic and most important level of implementation.
However when any new change is introduced in the organization, the employees tend to resist
the change due to low confidence and performance. Therefore, change management here acts
a very important role by providing a solution to cooperate between the changes and the
employees trust in the management. Cooperation between the change and employees needed
as it results in a strong foundation of the organisation (Mayella 2017).
Change management also depends upon several factors while implementation of any
organisational culture like diversity capacity of employees, acceptance of change by the
employees, scope of change and including timing of change. Many studies have conducted to

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find out that how any organisational change affects the performance of Tesco. One such case
study states that Tesco decided to review about their management practices which provides
customer satisfaction to find out about any low efficiency. The change management process
starts with providing training and knowledge to the workers because they are in direct contact
with operations of the organization daily. The training of the employees became important for
the organization as the diversity of the workers like their racial, social & economic
backgrounds was becoming a hinder for the organization as they consist of diverse skills and
shortcomings. Therefore, they need customized training depending upon their personality.
The need of training is also important, as recruiting new labour could be more costly for the
organization. The factors that affects the changing decision are the society and the customers.
There are other factors in Tesco that is affected as well like success of the change
management, workers resistance to the change on the culture, the reflection of the cultural
change in the language (Mollah 2014). The following factors discussed below in detail:
Success to the change management: the success definitely depends upon the match
between organisational culture and individual. The attitude of the employees in the
organisation has a great influence on the implication of the change. The dedication of the
worker shows that how much he/she is interested in the betterment of the organisation. The
organisational change will be possible when the individual values maintained by the
organization. The managers should understand the organisational culture that motivates or
influences the employees and makes the implication of change management easy. For
improving the productivity of the organisation, it is important for the employees to accept the
change management. The bottom line or the employees who directly related to the operations
of the business should managed properly so that the organisational culture has a positive
effect on the change management.

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Employee’s resistance on the change: it is important for every organisation to match
the employee value with the organizational value otherwise, the implication of the change
management would be difficult. In this frequently changing market culture, it is important to
adopt the change management by every organisation; else, the market position will hampered.
Two factors that decides the impact of the organisational culture on the change management,
one is the production and the other one is viability of the organization. Many studies have
conducted for this matter and it was concluded from that the two key factors have great
influence on the change management.
Reflection of the organisational culture in the language: the language of the
organisational culture also has a great impact on the organisational change. The language of
the organisation indicates the underlying attitudes of members towards any kind of
organisational change. Form the language it can be reflected that how the employees will
react and implement the change. A person’s value should match with the organisational
values otherwise, then they will clash (Dillon 2015).
The impact of the organisational culture of Tesco has mostly positive influence on the
change management process. From different studies conducted with primary research, it has
been found out that globally the employees of all organisation has proved that training and
additional programs regarding the organisational culture can be helpful for the change
management to conduct an acts as primary influencing factors (Hornstein 2015). The training
program involves Induction program, training program, team building activities and many
more. Other factors like retirement plans, discharge of duty also indirectly influences the
change management in Tesco. The primary factors mainly considered by the employees that
acts as an influencer for adopting the change management on the organisation.

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Organisational culture of Tesco plc also reflects a negative impact on the change
management process. When the employees of the organization are not enough motivated
towards the change in the market then this resisting behaviour can result in non-application of
the change management in the organization (Thomya and Saenchaiyathon 2015). The
managers should manage individual employee value and the organisational value of the
organisation properly so that there are no clashes between the two otherwise, the adoption of
the organisational change management will not be possible as the main operations of the
organisation is managed by the first line employees in Tesco plc. The previous organisational
norms and rites are also very influential in reflecting the employee value because then the
point of view of the employees’ towards any future change management would result in
restriction while accepting any organisational change.
It is very important for every organisation to maintain a balance between the
organisational culture and the employee value so that the organisation can absorb the changes
effectively. Tesco plc uses the positive ways to motivate the employees that results the
organisation to adopt the changes positively because the employees of the organisation given
training and knowledge regarding the organisational change management. The employees of
Tesco has stated that the frequency of change in organisational culture depends upon the
market demand and that initiates the need of change in the previous organisational culture.
The individual value of all the employees in Tesco given equal importance from the first line
staffs to managers that helps them to cooperate with the change efficiently (Xie and Allen
2013).
Conclusion
Tesco Plc has a vibrant history starting back to the year 1919 when Jack Cohen
founded it. It had a very humble beginning. Gradually the company went on to become a
prominent retail store. It expanded its business from just food items to non-food items. The

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company operates in a number of countries worldwide. Therefore it has to tackle the various
macro environmental issues of each of these countries to sustain the market. Tesco Plc had
undergone various strategic changes over the years. The company had a very impressive
leadership style under the direction of Terry Leahy. After he resigned the company had to
face certain challenges under leadership of new CEOs. The company is trying to resolve the
issues to adopt a healthy work environment. Tesco tries to motivate its employees by giving
proper training. Tesco should adopt more effective ways to ensure that the customer and
employee relationship stays cordial.

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