Sainsbury's: Information and Technology Management Report Analysis

This report provides an analysis of Sainsbury's information and technology management, examining its strategies for achieving competitive advantage within the retail industry. The report begins with an introduction to Sainsbury's, highlighting its market position and the importance of digitalization. It then delves into the application of Porter's Five Forces model to assess the competitive landscape and identify key threats and opportunities. Following this, the report explores Sainsbury's value chain, detailing how the company adds value through its various activities. The analysis emphasizes the role of information technology and innovative ideas in enhancing business performance, attracting customers, and gaining an edge over competitors. The report concludes by discussing how Sainsbury's leverages technology to improve its operations, supply chain management, and customer engagement, thereby solidifying its position in the market.

Managing
Information and
Technology

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................4
Porter's Five Forces Model to analyse the competitive advantage:........................................4
Porter's value chain of Sainsbury's.........................................................................................6
Analysis..................................................................................................................................9
The business could deploy information technology and innovative ideas to improve the
performance of business and gain competitive advantage.....................................................9
CONCLUSION .............................................................................................................................10
REFERNCES:................................................................................................................................11
Books and Journals:..............................................................................................................11

INTRODUCTION
The role of information and technology is enhancing day by day. As technology is getting
updated at regular pace. For an organisation to achieve success requires management of
information and technology. This helps the organisation to set plans and objectives and achieve
them effectively. This report is based on Sainsbury's which is second largest chain of
supermarkets in the United Kingdom. The company has around 16% share in the supermarket
sector (Ilmudeen and Bao, 2018). The company was founded by John James Sainsbury in
1869.The products offered by company are wide variety of beverages, food and household
products like fresh produce, meat, baked and dairy goods. Also it offers range of everyday items
such as coffee, snack foods, groceries, confectionery, tobacco products, soft drinks, over-the-
counter drugs, toiletries, magazines and newspapers.
The company was founded in 1969 by John James and Mary Ann Sainsbury. They
opened a dairy shop in one of the poorest part of London. The company achieved success and
was able to reach customers by selling quality products and affordable prices. As the company
was able to attract customers they established various branches at different places. This is how
the company was able to form strong image in the market. The company has understood the
importance of digitalisation and taken steps. The use of updated technology is done by the
organisation. The company has its own website that is maintained and updated. They have made
their website user friendly (Pauley, 2019). Along with that they have understood the needs of
customers and launched its own application that helps them to enhance the customers base. This
is important for company so that all the customers can easily use the application and that has
enhanced the sales of the organisation. The main reason of success of the organisation is that
they provide quality products at reasonable process. Also the company offers essential goods that
are required by the customers. The company uses various marketing strategies to attract the
customers. The company attracts its customers to enhance the experience of customers. As use of
updated technology helps to help to improve the experience of customers.
Sainsbury's has various competitors and they make strategies to formulate strong image
in market. The company which uses updated technology is able to attract more customers and
gain advantage. This report is based on Sainsbury's and how the company manages the
information and technology. For success of an organisation it is vital to know about the trends in
the market ad then innovate the product that helps the company to gain advantage. In this report

there use of Porter's Five Forces Model to know about the competition in the market. And how
company is formulating strategies to gain advantage over the competitors. There are various
activities that are part of Porter's Value Chain Analysis that helps the company to achieve
success. In the end of the report there is discussion related to how Sainsbury's in using innovative
ideas that help to improve the performance of business and gain advantage over competitors:
MAIN BODY
Porter's Five Forces Model to analyse the competitive advantage:
It is a model that helps the company to formulate strategies that help them to gain
competitive advantage (Harlie, Rajiani and Abbas, 2019). As there are various competitors in
retail industry and it is important to know about the competition and gain lead over them. The
model includes five forces that help to determine the position of company in the industry. It
helps to the competitiveness and the profitability position of the company. This model was given
by Michael E. Porter. The model is respect to Sainbury's is discussed below:
Threats of New Entrants: When the industry is gaining profits. Then there is chance that
the new players are attracted towards the industry. This will create threat for already existing
players in the market. The firm should formulate strategies to reduce threat of new entrants. As
the retail industry is at boom. There are various new players that wish to enter the market. These
new entrants will be a threat for the company as they can take the customers of the company.
Sainsbury's The company uses innovative ideas that help to attract more and more customers.
Also use of updated technology helps the company to gain economies of scale. That helps the
company to offer quality products at low price (Naicker and Mafaiti, 2019). That helps company
to retain customers and reduces the threat of new entrant. Along with that company spends huge
amount of money on research and development that helps the company to form the strategies that
are better and not know by the new entreats. This makes Sainsbury's successful and achieve the
profitability position that can not be hampered by the new entrants.
Bargaining Power of Suppliers: The power of suppliers show that the suppliers are at
dominating position in the industry and that is a problematic situation for company. If the
suppliers are not in power that it is advantageous for the company. In retail sector all the
companies buy from numerous buyers. The suppliers are in power and that can impact the profit
margin of the company. The suppliers have more negotiation power. The strategies that are used

by company are they build effective supply chain so that they do not have to rely on single
supplier and that is profitable for the company and reduces the power of suppliers. Along with
that the company finds different ways of product designing so hat they are not dependent on raw
material if the prices go high.
Bargaining Power of Buyers: The needs and wants of buyers are ever changing and it is
important to satisfy them. The company make efforts to retain the customers. By using updated
technology and innovating the products Sainsbury's is able to attract more customers. Also the
company sells the products at affordable prices that helps the company to retain the customers.
The company provides offers and discounts to all its customers that helps the company to gain
loyal customers (Berente and et. al., 2019). The company should make efforts to know about the
trends in the market and then make efforts to satisfy them. The updated technology helps to
attract more and more customers. The company focuses on enhancing the customer base so that
the bargaining power of buyers is less. Also by the use new and innovative actions it is possible
to attract the customers.
Threats of Substitute Products or Services: When same product is offered by other
companies then customers have option to switch to other products that is offered by the
substitute. In retail industry there are various competitors that are offering the same product.
Sainsbury's then innovates the product and always add something new to attract more and more
customers. Also they understand the core need of customers and then develop the product
accordingly. Here the technology plays an important role. As new ways of digital marketing help
company to understand the need and want of customers. Along with that it helps to analyse
which product offered by the company is able to achieve success. As the company can focus on
the products and innovate them as they are not having that much demand. There are various
customers in retail industry and the task is to retain them.
Rivalry among the Existing Competitors: There are direct competitors of Sainsbury's. So
it is important for the organisation to know about the competition in the industry. It is vital as
there is direct impact of competition on profitability position of the company. Also the buyers
also get options to switch (Goldkind and McNutt, 2019). Sainsbury's find ways and procure
knowledge about the strategies that are used by the competitors in the industry. The company is
able to gain more profits if they take advantage over them. The company should understand the
taste and preference of customers and then offer them innovative product. As the customers are

present in the market the task is to attract them towards the organisation. By using digital
marketing the customers are attracted towards the organisation and the reach also increases. The
mobile application launched by Sainsbury's is also an example of up[dated technology used by
them. This helps the customers to buy from Sainsbury's. The company makes efforts to enhance
the market share and serve more and more customers.
The Porter's Five forces Model shows the real picture of Sainsbury's and where they
stand in the market. Also the strategies that can be used by organisation to gain advantage over
the competitors in the market.
Porter's value chain of Sainsbury's
Value chain model is the framework that helps to create the competitive advantage in the
market with the help of analysing company's all activities. It is very necessary for organisation
because every organisation want that they can achieve their goals but due to increasing in day to
day competition, it is analysed that they companies face difficulties. It can be deal with the
introduction of innovation in IT department of the company so that can increase their value of
company for taking competitive advantage (Grewal and et. al., 2020). IT plays a main role in this
section because a company can take competitive advantage only when they innovate their
products and process. IT is the factors that helps to innovate their functions and operations so
that they get competitive advantage. This model helps in understanding that Sainsbury's add
value to their products and services so that they can take competitive advantage. It is the activity
in which they sell their products and services in such a way that helps in add value and generate
a profit margin. It is the activity in which Sainsbury's improve their IT department so that they
can add value to their products and services. IT is essential for organisation because in nowadays
everything is run on the basis of information and technology. Porter's value chain helps to
analyse the activities that need to be improve so that they can take competitive advantage. It
ultimately increase the margin of profits that can be understand with the help of below equation:
Value Created and Captured – Cost of Creating that Value = Margin
It have two activities that are mentioned below which assist in understanding of
importance of Porter's value chain that why Sainsbury's choose this model:
Primary activities

It is directly concerned with the creation and development in products that means it is the
process in which Sainsbury's focuses on creating innovative products for attracting their
customers (Sozinova, 2018). They have mainly five areas that are considered in primary
activities. All five areas are mentioned below: Inbound logistics: It is concerned with support of a service or product, sale, physical
creation, maintenance, etc. In this area, suppliers are the key element so that's why they
are focusing on creating value. It can be clearly show that their business is built on
excellent only because of their long lasting relations with their suppliers. For checking
the ability of suppliers they are regularly checked their quality, ethical standards and
safety of their products that they are sourced from UK and 70 other countries (Foroudi
and et. al., 2017). Operations: It is the stage in which company focuses on transforming their inputs to the
output which they want to sell their customers. There are two types operation that
Sainsbury's focuses to improve so that they can create value in their products. Two types
are closed and open loop (Kumar and et. al., 2019). Open loop is the stage in which
Sainsbury's focuses on transformation of input into output. Whereas closed loop helps to
control the activities in operation, so that they can manage operations.

 Outbound logistics: It is concerned with delivering of final products to their customers.
Sainsbury's focuses on building their distribution systems so good which assist in
fulfilling requirements of customers. They have 34 distribution centres which gives fast
deliveries to their customers so that they can not wait too much for receiving their orders.
For this purpose Sainsbury's have stores as well as online market from which customers
can order their goods. Marketing and Sales: Sainsbury's marketing and sales are very nice that can be clearly
seen from their growth and success. They use digital as well as traditional marketing
method so that they can attract more and more customers. Their marketing methods helps
to increase value in their key elements of marketing mix.
 Services: Sainsbury's provide a goof range of service as they will not stop their services
after the sale of products (Cheng and Liu, 2017). But they make assure that their
customers feel free to contact with them. It is very important for building trust of
customers on company.
Support activities
It is the activity that supports organisation for creating value in their company so that
they can take competitive advantage and generate profit margins. These activities are supporting
primary activities. There are some activities that are mentioned below: Procurement (purchasing): It includes vendors that are finding by organisation from
which they purchase goods. It helps to operation stage of primary activities. Human resource management: HRM is very important for organisation that they can
easily manage all the activities in operation process. It assist in fulfilment of vacancies in
the organisation so that it will not exploits any process. Technological development: The major factors that should be analysed by organisation
and support all activities i.e. IT department that deals with technological development.
With the help of improvement in IT department it assist in creating value for the
organisation that ultimately achieve organisational goals and objectives (Zhang, Kumar
and Cosguner, 2017). It is necessary because it is identified that every organisation need
to develop their IT department due to day to day increase in change of techniques.
 Infrastructure: Infrastructure is the most important element that decide the success and
growth of organisation because it includes many activities such as management structure,

legal structure and finances. All three structures are very important because management
structure helps organisation to identify the complex activities so that Sainsbury's can take
decision regarding them and manage easily. Finance structure is the backbone of
Sainsbury's in which they decide the budget of each activity.
Analysis
Porter's Five Forces Model helps Sainsbury's to form a strong position in the market. This
also helps the company to formulate strategies that are helpful for the organisation. It is seen that
Sainsbury's has direct competitors like Tesco, Aldi. The company makes efforts and gains
competitive advantage over them (Jusop, Ismail and Ismail, 2020). There are substitute goods
available in the market. So to attract and retain customers company uses digital marketing
techniques. Also they offer the goods at prices lower than that of competitions. There are various
suppliers available in the market but them have power so the company make efforts to build
strong supply chains so as to ave supplies. The company forms various methods of designing the
product so that change in price of raw material do not cause any problem for them. There are
various buyers in the industry the company use mobile application that also Sainsbury's to serve
more customers.
Porter's Value Chain model is very necessary for organisations' success and growth. It
helps in creating values for organisation that assist in taking competitive advantage. Every
organisation need competitive advantage so that they can create monopoly and add value in their
cost which assist in building profit margin for organisation (Berthon and Pitt, 2018). It is
analysed that this model is very helpful to find out the activities that are key element for
Sainsbury's. They have mainly two support activities of Sainsbury's which helps in crating values
in their products and services that are technological development which focuses on IT
development and human resource management.
The business could deploy information technology and innovative ideas to improve the
performance of business and gain competitive advantage.
The technology is rapidly enhancing. It is important for all the business to understand the
current technology and it importance. It is important to innovate with the environment and take
measures to develop the products offered by the company. Sainsbury's offers its products at fair
prices and that are lower than that of competitors. By using updated method of research and
development. The company is able to collect all the information that its important. This helps

them to know about the product that is enhancing there sales. The innovative methods that are
used by company helps them to enhance there production process and help the company to
achieve economy of scale (Martin and Murphy, 2017). This helps the company to supply new
and developed product to its customer. Sainsfuby's adopts faster supply chain as it helps the
company to supply goods on time. The company has improved self check out points as that
reduces the lines and saves the time of customers. Digital marketing helps the company to attract
more customers. All these advancements and benefits are faced by company due to proper use of
information and technology. Sainbsbury's manages the information and technology effectively
and that helps the company to gain advantage over the competitors. Proper use of technology is
important and enhances the performance of business.
CONCLUSION
From the above report it can be concluded that a company to achieve success. The needs
and wants of customers are ever changing. Sainbsbury's is company in retail sector that has
various competitors. The company should formulate effective strategies that help them to attain
lead over them. The use of updated technology has made the organisation to achieve success by
attracting more and more customer and serving them with quality products and low prices. The
innovative ideas help to satisfy the customers. There is discussion of Porter's five forces Model
to know about the strategies that help them to gain advantage over competitors. Porter's Value
chain model is also discussed in this report. In the end there us discussion about both the models
and how information and technology helps business to achieve success is also discussed.

REFERNCES:
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