Strategic Management: Tesco's Strategic Analysis and Implementation

This report provides a comprehensive analysis of Tesco's strategic management, focusing on its transition to online operations. It begins with an introduction to strategic management and its importance for Tesco, a multinational retail organization. The report critically assesses the strategic management process, outlining the six stages involved. It then evaluates various strategic models and tools, such as SWOT and PESTLE analysis, and applies these tools to Tesco's specific context, examining political, economic, social, technological, legal, and environmental factors. The application of SWOT analysis highlights Tesco's strengths, weaknesses, opportunities, and threats. Furthermore, the report critically appraises change management based on the complexity of the transformation process. The report concludes with a summary of findings and references.

Strategic Management

Table of Contents
1. INTRODUCTION.......................................................................................................................4
2. CRITICAL ASSESSMENT OF THE PROCESS USED BY ORGANISATION TO
DETERMINE STRATEGIES.........................................................................................................4
3. EVALUATION OF DIFFERENT MODELS AND TOOLS UTILISED BY A BUSINESS
ORGANISATION TO DETERMINE THEIR STRATEGY..........................................................5
4. APPLICATION OF THE DIFFERENT TOOLS THAT ARE UTILISED BY TESCO............6
5. CRITICAL APPRAISAL OF CHANGE MANAGEMENT BASED ON THE COMPLEXITY
OF THE TRANSFORMATION PROCESS...................................................................................9
6. CONCLUSION............................................................................................................................9
7. REFERENCES............................................................................................................................9

1. INTRODUCTION
Strategic management is a process of managing the sources of an organisation in order to achieve
all organisational aims and objectives in an effective manner. It is a process which involves
number of stages number which helps the company to establish their strategies and appropriately
implement them or bring them into practice for desired outcomes (Newburry, Deephouse and
Gardberg, 2019). A Strategic managers role is to develop and overlook on the plans of entity in
order to meet their benchmarks. Strategic management plan is developed by following a
thorough process which has six stages and all the stages enable the strategic manager to develop
and implement an effective strategy for the respective organisation. Tesco is a multinational
organisation which is operating in retail industry through the supermarkets. In the current
scenario the company Tesco is only having its operations offline. This implies that Tesco make
sales and render there offering to people with their physical stores present in different locations
worldwide. Now the company is planning to expand in the digital field and accordingly moving
its operations online. In order to do so plans are developed with the help of strategic management
process which has six stages.

2. CRITICAL ASSESSMENT OF THE PROCESS USED BY
ORGANISATION TO DETERMINE STRATEGIES
The stages of strategic management process are explained underneath in relation to Tesco.
1. Identify the strategic position is the first stage where Tesco will evaluate its position
and determine their objectives both long and short term. The company needs to developer
clear vision for executing its plan and obtaining its objectives. While preparing in
determining the strategic position Tesco needs to to make sure that their objectives are
realistic and measurable.
2. Gather information and people once strategic position is determined. The human
resource is required bi test score who will be involved in establishing the strategic plan.
Also all the updated information should be on the table while preparing the plan for
developing the most effective plan (Okumus and et. al., 2019).
3. Perform a SWOT analysis for identifying the internal strengths and weaknesses of
Tesco and external opportunities and threats which can affect the company in positive
and negative manner. The SWOT analysis will provide Tesco a clear picture about the
strengths and opportunities which can be used by company to move in the right direction
and making effective use of there abilities.
4. Develop a strategic plan, once the strategic manager of Tesco and it's team is well aware
of all the strengths and opportunities of company. The strategic plan will be developed in
accordance to increase the efficiency of company by moving its operation online with the
help of digital media and advanced technologies. The plan will be consisting the
objectives and the strategies which can be adopted by Tesco for establishing the business
online.
5. Execution of plan, it is the second last phase strategic planning process. As the plan is
developed now it is action time where Tesco will implement the strategic plan. At this
stage all the respective tasks will be assigned to specific employees and departments
according to their skill sets and expertise (Barbosa, Castañeda-Ayarza and Ferreira,
2020).
6. Regular monitoring of performance, is the last stage which comes after the plan is
implemented and executed. Tesco will constantly monitor and evaluate their online
performance in order to seek knowledge about its effectiveness. Moreover it also help the

management of Tesco to identify any shortcomings in their process and fix them
according to the requirements of the entity.
3. EVALUATION OF DIFFERENT MODELS AND TOOLS UTILISED BY
A BUSINESS ORGANISATION TO DETERMINE THEIR STRATEGY
In present time, business market consists of different models and strategic tools available for
various organisations that are dealing at both domestic and international market. SWOT analysis
and pestle analysis are the two different types of analysing models that can be utilised by buy the
scope for any other business organisation at the time of transforming itself from avoiding the
traditional approaches and starting the new approaches of the modern ones that may lead them to
sustain within the market for a longer period of time. Basically, if it is critically analysed then the
business organisation that is Tesco was looking forward to bring modifications within its
operations through going online industry and start targeting customers that are well aware of
technology or tech savvy (Taylor, Okazaki and Mueller, 2019).
Considering the swot analysis, it can be said that it will help company in analysing the internal
sources, skills of the employees and other aspects that they can perform in relation to gathering a
all new strategy for themselves. But, it will not be that much of effective in nature because list
will only lead company to focus among all the visual aspects that they are already having and it
may also lead them to go through different problems as well while creating or developing a
strategy.
If it is talk about, pestel analysis then it will consider different range of factors that are available
in the external market which may affect companies operations in both negative and positive
manner. At the time of developing strategies it is said that political, social, technological, legal,
environmental and economic are said to be some different aspects that are required to be
undertaken so that no risks may take place at the time of creating a strategy (Ferch and Roe,
2019). on the other hand, if it is critically analyse then it is said that for a business organisation
like Tesco it is much needed to not only analyse these elements but to consider the other ones as
well as these are not only the factors that affects the company but some others as well that are
not linked with Government, employees, or any other respect like atmosphere.

4. APPLICATION OF THE DIFFERENT TOOLS THAT ARE UTILISED
BY TESCO
PESTLE Analysis: This framework is useful in examining the external factors and concerning
risk associated with them. This framework is conducted in relation with Tesco it is a big
multinational grocery store in UK. There are many factors which influences the sudden growth
of company or group so to get a better understanding of these reasons and drivers few factors are
described as under:
 Political: This factor is concerned about the operational activities of company in order to
operate their business at global level and for this organisation need to analyse
international political factors which influences their overall performance. For this it
include tax rates, legislation, exchange rates and so on. In relation with Tesco Brexit
become its main enemy as it cut down the stability of company in relation with
shareholders and financial terms. As company is currently offer its products and services
from their stores and now they are expanding it on online platform. Therefore, Tesco
need to prominently determine the political factors and its impact on the decision and
functioning of company (O'Brien and et. al., 2019).
 Economical: It becomes the biggest concern for the expansion of business as it include
cost profit prices and so on in relation with this the demand of commodities are impacted
by the level of income and employability which is altered because of demand and supply
of business within the whole market. This factor is completely depend on the outside
factors and also controlled by macro elements. In relation with Tesco brexit occur major
changes in the pricing of commodities in which company need to use outsourcing as their
trading in order to increase their prices in the food market of Britain it is badly affected
because of cheap products and for this, company consider diversification as their strategy.
 Social: It depicts many factors including lifestyle education living conditions and so on.
The population of UK is moving towards the Organic products which is in their trend.
Therefore Tesco increases there variety of commodities in terms of food and non food
items and also choose prominent approach and bring changes in there commodities range.
For this the demand is influenced by the believes in value of people which is highly
influenced by the social conditions which alter their corporate behaviour. Hence to offer

products at online platform Tesco need to determine the social and cultural factors of the
area in which they offer their services.
 Technological: It describe introducing new innovative technologies in the business
activities and in relation with Tesco it becomes the biggest advantage for them to
improve their customer satisfaction as currently they offer their services through their
stores. By providing the services through online platform helps them to enhance their
customer base and provide prominent customer satisfaction. Moreover in their offline
stores the currently used few advanced Technologies such as electronic fund transfer and
self-checkout machine which is more convenient for the customers. Through this way
Tesco manages to improve their stocking and image which helps them to reduce labour
cost and extra time for their customers.
 Legal: Government norms and policies directly influences the performance of company
as the code of conduct and ethical values of UK is currently banning many practices like
changes in prices and demands of suppliers without any notice. In this regard the
government policies for Monopoly control and reduces the buying power of monopolist
and also limit the entry of these markets (Doherty, Haugh and Lyon, 2020). In relation
with Tesco they follow these policies by offering price elimination and promotion in
relation with their product with the help of proper advertisement in the supermarket.
 Environmental: The image of Tesco regarding the corporate social responsibility is quite
positive because they are involved in various activities concerning the elimination of
pollution. As company operate in in food services for this the lifespan relies on the health
of nature and for this they play important role in order to protect the environment by
addressing the impacts on the business activities in supply chain. Moreover they are also
engaged in attaining zero deforestation by 2020 as it include the sustainable footprint of
weather conditions and reductions of wastewater. Lastly, they also introduce reduce,
reuse and recycle action in their store to offer recycling option to their customers.
SWOT Analysis:
 Strengths: Tesco has most important asset in terms of its competitors as they are the
leader of market in terms of market share with approximately 27 per cent. For this, it is
not quite hard to protect the highest number of customers for company and also set

highest standard for others to meet the demand of customers. Moreover Tesco is engaged
in in our changing standard of society which include new and existing customers of their
stores and also of a reward to their customers Club cards in order to say thank you. As
this is the strategy to retain their customers for longer period of time and the marketing
team of Tesco open new and innovative ideas such as customer personalized promotion
and incentives to acquire more customers (Witcher, 2019).
 Weaknesses: By determining the dynamic nature of retail sector around 6% it off the
grocery customers switch their brands in terms of satisfaction and quality. Brexit also
become the main weakness for company as a drive high inflation in UK and also
increases the cost in terms of trade. New import duties and tariffs also imposed that
impacts the economy of country which can become obstacle for Tesco in the upcoming
years. With the direct impact of Brexit, prices are reduced of products and employment
decreases that leads to cut down the operations of company.
 Opportunities: Its popularity becomes the opportunity in terms of multichannel retailing
and company can also use artificial intelligence (AI) in its store. Currently the customers
of UK looking for fair price quality Indian relation with this Tesco already meet the
demands of customers as they have the widest self owned food brand which becomes an
opportunity for company to find the suitable business for them by developing prominent
marketing plan to meet the demand and make sure the growth and
profitability(Wooldridge, B. and Cowden, B., 2020).
 Threats: Dynamic business environment, increasing competition and frequently changing
needs of customers can become threat for company. Moreover in terms of market share
company has many competitors as its biggest competitors include Sainsbury’s with
around 15.8% market share, Asda and Morrisons with approximately 15 per cent and 10
per cent market share. After all this if company fails to review its trading opportunities
then it will result in loss of market advantage and also increases the risk factor for
company that remain unchanged for their business operations.
5. CRITICAL APPRAISAL OF CHANGE MANAGEMENT BASED ON
THE COMPLEXITY OF THE TRANSFORMATION PROCESS
Change management within today’s business industry that has affected companies' performance
level in both positive and negative. Every now and then, business organizations change the way

they operate and the services/products they offer. There are new initiatives in organizations and
the old ineffective practices are forced to leave.
In addition to that, technology is constantly changing and the business organizations need to par
with that as well. There are many approaches about how to change. Of course, we may all agree
that the change is required for an organization, but can Tesco and other organisations all be in
agreement of how the change should take place? Usually not! Therefore, deriving a change
management process should be a collective effort and should result from intensive brainstorming
and refining of the ideas (Ansoff and et. al., 2019). The time of transformation process, Tesco
has faced a number of issues in regards to cost, sustainability and so on. In order to bring change
within the existing process, it requires investment where it is may be possible that companies
manager might not become able to influence investors.
So, it is much required by the business organisation that is Tesco to go through different aspects
and ask themselves to plan every single element so that investors for effectively lend money for
their own betterment and of the company as well. Also, it is said that sustaining within the
market it is much required by them to keep on monitoring the plans, so that right decisions could
be made in order to reach to the goals and objectives in much effective and efficient manner.
6. CONCLUSION
With the help of above mentioned report, it is clear that for a business organisation which is
looking forward to transform itself from a traditional business approach to a modern one then it
will be required by the company to focus over different aspects in relation to developing strategy.
The help of this an organisation could effectively attain the desired goals and achieve success in
near future.
7. REFERENCES
Books and Journals
Newburry, W., Deephouse, D. L. and Gardberg, N. A., 2019. Global Aspects of Reputation and
Strategic Management', Global Aspects of Reputation and Strategic Management (Research in
Global Strategic Management, Volume 18).

Okumus, F. and et. al., 2019. Strategic management for hospitality and tourism. Routledge.
Taylor, C. R., Okazaki, S. and Mueller, B., 2019. Drawing on Theories from Strategic
Management and International Business. Advertising Theory.
O'Brien, D. and et. al., 2019. Strategic Management in Sport. Routledge.
Witcher, B. J., 2019. Absolute Essentials of Strategic Management. Routledge.
Ansoff, H. I. and et. al., 2019. Strategic Issue Management. In Implanting Strategic
Management (pp. 431-447). Palgrave Macmillan, Cham.
Wooldridge, B. and Cowden, B., 2020. Strategic Decision-Making in Business. In Oxford
Research Encyclopedia of Business and Management.
Doherty, B., Haugh, H. and Lyon, F., 2020. Strategic management tensions in hybrid
organisations. In Handbook on Hybrid Organisations. Edward Elgar Publishing.
Barbosa, M., Castañeda-Ayarza, J. A. and Ferreira, D. H. L., 2020. Sustainable Strategic
Management (GES): Sustainability in small business. Journal of Cleaner Production, p.120880.
Ferch, S. and Roe, M., 2019. Strategic management in East European ports. Routledge.