Strategic Management & Business Plan: A Case Study of Tesco PLC

This report provides a comprehensive analysis of Tesco PLC's strategic management, examining both internal and external factors that influence the organization's business operations. It defines strategic management and critically assesses the processes used by Tesco to determine its strategy, including SWOT and PESTLE analyses. The report evaluates the impact of internal factors such as strengths and weaknesses, and external factors like political, economic, social, technological, legal, and environmental elements on Tesco's strategic decisions. Furthermore, it reviews Tesco's strategic plan, focusing on an action plan for innovation in the LED product line, considering changes in the business environment. The analysis concludes with insights into how Tesco can leverage its strengths to minimize weaknesses and capitalize on opportunities while mitigating external threats, emphasizing the importance of adapting to the dynamic business landscape.

Strategic
Management
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Table of Contents
Introduction ...............................................................................................................................3
TASK ...........................................................................................................................................3
Conclusion .................................................................................................................................8
References .................................................................................................................................9
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Introduction
strategic management is related to the planning and organizing all the necessity of a business
to achieve the goals and objectives of the organization. The business environment are
completely changed sue to the dynamic behavior of customers so strategic planning is
important to gain the competitive advantage from the market. This report states various
definitions of strategic planning to critically analyses the importance of strategic management
(Makadok, R., Burton, R. and Barney, J., 2018). It emphasizes explanation of various internal and
external factors which impacts the organization from both inside and outside the organization
the organization which is chosen here to describe this report is Tesco plc. TESCO is a
multinational public limited company of United Kingdom provide retailing service of
groceries and general merchandise. It is founded on 1919, 102 years ago by Jack Cohen in
Hackney, London, England, UK. It is a ninth largest retailing company of UK and its Head
Quarters is in Welwyn Garden city, Hertfordshire, England, UK.
TASK
Definition of strategic management
Strategic management is the management of organizational resources to achieve the goals
and objectives of the organization. Under this management the managers og organizational
analyses various aspects such as strength weakness, competitive advantage and business
environment to achieve the objectives of the organization. Various strategies related to the
business of organization are developed in this management.
A critical assessment of the process used by organizations to determine their strategy
The management of Tesco is applied SWOT analyses on their organization to analyse
the condition of company on the basis of strength, weakness, opportunity and threats.
There are many strengths of company which helps the company to successfully applied
various strategies (Priem, 2018). Tesco has also some weaknesses which they have to
minimise to protect themselves from any loss. There are many opportunities present in the
market which enables the organisation to established their business in different countries.
Company applied Pestle analyses on their management. It analyse various impacts of
various factors of PESTLE analyses on business operations of Tesco.
A critical evaluation of the impact of internal and external environmental variation on
organisational strategy
Swot analyses of Tesco
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SWOT analysis identify the internal and external factors that affect the business environment
of the organization. SWOT analysis is a technique in which companies’ analysis present best
things in order to make successful strategy for future use. SWOT analysis help companies to
identify their strengths, weaknesses, opportunities, and threats in order to improve and
maintain their position in the market. TESCO also uses SWOT analysis to identify its
strengths, weaknesses, opportunities, and threats in order to improve its position in the
market.
TESCO's Strengths
Strengths are basically those internal factors which make companies strong to maintain its
position in the market for long term. Basically, strengths are those factors or advantages of
the company which make them different and unique from its competitors. According to
SWOT analysis a company first identify and framed list of its strengths. The Strengths of
TESCO that help them to maintain its market position are financial turnaround, market share,
strong performance during pandemic, Innovation, and adaptability. These are the strengths
makes TESCO's management successful and improve its growth in the market.
TESCO's Weaknesses
Weaknesses are those internal factors which may cause risk for the business organisation to
maintain its position in the market. A company should identify all its weaknesses if it may
cause any problem in the future then hey will prepare with the solution. Weaknesses of
TESCO that may cause hurdles and find way to overcome are leadership change, quality
control, shortage of products, inventory management, food safety issues and so on.
TESCO's Opportunities
Opportunities are the external factors that is available in the market by adopting a company
can easily increase the growth of the company. Some of the Opportunities that are available
in the market for TESCO are growth of online grocery sales, high- unemployment rates, rise
of meat alternatives, social supermarket, AI and machine learning.
TESCO's Threats
Threats are the external things from which a company may faces many problems for
maintaining its position in the market. TESCO is top leading company of UK it is necessary
to them to identify its threats in order to maintain its position in market. Some of the basic
threats that are available for TESCO are UK-EU relations, Brexit and supply chain,
economic recession, COVID-19 pandemic, competitors and many more that may cause
problem for them.
PESTLE analyses of Tesco
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There are many external factors which are present outside the organisation but it
impacts the operations of business organisation in both the aspects such as positive and
negative. The brief discussion related to the impact of these factors on Tesco are given below.
Political :- It is to those factors which is related to the pollical aspect of the country. One of
the most important political factors which influence the business of every United Kingdom
organisation is Brexit. It is related to the withdrawal of United Kingdom from the European
nations and all the trade agreements between these nations and United Kingdom are
terminated. All the organisation of United Kingdom are facing difficulties to operate their
business in European nations. The business of Tesco also affected due to the Brexit because
the transportation charges increase in nations which minimise the profit margins of company.
Economic :- One of the most important economic factor which influences the global
business is covid Pandemic. It impacts the business cycle negatively and becomes difficult
for many organisations to survive in market. There are many restrictions and guidelines are
enacted to perform the business such as social distancing and maximum customer limit. The
business of Tesco is protected from these guidelines due to their online shopping business
arm. There are many organisations which expand their business in countries but Tesco limits
their business in British market so the minor changes in laws can harm the business of tesco
very badly.
Social :- It is related to the various social factors such as traditions beliefs and cultures.
These factors influence the business of organisation in many aspects. Tesco offers halal food
in their food range in United Kingdom for their Muslims customers. It ensures the beliefs of
their customers because it also offers Kosher products for their Christian customers in Uk.
Tesco analyses the increasing trend of vegan foods as public shift from meat to vegetables so
the company offers various food products based on vegetables and free from meat.
Technological :- It is one of the most important factor which impacts the business of
organisation. It is not possible for any type of organisation to become successful in this
highly competitive market without the use of modern and advanced technology. Tesco also
analyse the need of technology in their business so it introduces many technology such as
mobile payment system in their business. Tesco also opens their online shopping apps which
helps company to deals with many problems such as Covid outbreak and Brexit.
Legal :- This factor of PESTLE analyses is related to the various rules and regulation
developed by the government of respected country. The business organization operates their
business in more than one country and each country has different rules and regulations which
the organisations have to follow in their business(Barney and Mackey, 2018). The negligence of
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these regulations enables the company to become liable for penalty. Tesco operates their
business operation in United kingdom and it has to deal with the various legal rules made by
the authorities of United kingdom.
Environmental :- It is related to the natural environment of respected country where the
company operates their business. There are many countries in the world which becomes more
sensitive towards their natural environment and suggest the business organisation to use those
strategies and techniques which sustained and promote their natural environment. Tesco
performs many environment activities such as Tesco launches their environmental
programme under which the company focus on the reuse and recycle of plastic waste and
minimise the use of single use plastic and non-recycle plastic.
A review of an organisation’s strategic plan (Business Plan), providing an action plan
for the organisation on the basis of a change in either the internal OR external
environment. (The Business Plan is included as an Appendix)
Executive summary
The management of Tesco include well experienced and qualified executives and
managers which analyses the business environment carefully and prepare business
strategy for the business (Bell and et.al., 2018). The management of wants to innovate their
existing electronic product LED with the android LED. For this purpose, management
prepare innovation and marketing strategies.
Mission
The overall mission of the company is to capture the market share of Unite kingdom
market by their new and innovative products.
Vision
The vision of company is to satisfy the dynamic needs of customers and gain
customers loyalty with their products and services.
Objectives
There is a cut throat competition in the retail market of United Kingdom and many
big players takes all the profits margins so Tesco decides to introduce innovated product in
the market to gain competitive advantage in the industry and it also increase their profit
margins.
SWOT analyses of Tesco
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There are some factors which are present inside the organization but impacts thee
organization in many aspects and the brief discussion related to these factors are given
below (Denning, 2017).
Strength
 One of the most important strength of Tesco plc is their brand image on the mind of
customers.
 Tesco has applied many technology in their business operations and achieve cost
efficiency which help[s them to survive in market.
Weakness
 It is seen in many Tesco’s subsidiaries that the business are not running well due to
their weak management structure. This weakness of company makes negative impact
on their growth.
 There are many retail organisations working in United Kingdom market which leads
to start price war in market and the profit margins of company becomes minimised.
Opportunity
 There are many opportunities are present where Tesco operates their business, many
local firms and companies are present for joint venture with Tesco. These companies
help the Tesco to conduct market research where they positioned their innovated
product.
 There are also some opportunities present in online shopping market such as home
delivery.
Threats
 The economic recession due to some natural disaster covid and many more becomes
the greatest threat for every organization working in market (Bonsu, 2019).
 There is great hike in the prices of raw material which reduces he profit margins of
company so Tesco try to enhance their suppliers network so that thay get raw material
at best prices.
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Figure 1tesco case study how online shopping is born
Sources: https://compartmentalization/tesco-case-study/
Conclusion
It is concluded from this report that there are many internal factors such as strength,
weakness, opportunity and threats which are present inside the organization and impacts
the business of company in many aspects. Company should use their strength to
minimize their weakness and grab all the opportunities from the market which helps
them to deal with the external threats. This report concludes impacts of various external
factors. These factors impact the business of organization and sometimes becomes harsh
for business to deal with these factors. It concludes the business plan of Tesco under
which the company plan to launch innovated product.
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References
Makadok, R., Burton, R. and Barney, J., 2018. A practical guide for making theory contributions in
strategic management.
Bell, R.G., Filatotchev, I., Krause, R. and Hitt, M., 2018. From the guest editors: Opportunities and
challenges for advancing strategic management education.
Barney, J.B. and Mackey, A., 2018. Monopoly profits, efficiency profits, and teaching strategic
management. Academy of Management Learning & Education, 17(3), pp.359-373.
Priem, R.L., 2018. Toward becoming a complete teacher of strategic
management. Academy of Management Learning & Education, 17(3),
pp.374-388.
D’Cruz, J.R., 2018. Strategic Management of Subsidiaries 1.
In Managing the multinational subsidiary (pp. 75-89). Routledge.
Barney, J.B., 2017. Resources, capabilities, core competencies, invisible
assets, and knowledge assets: Label proliferation and theory
development in the field of strategic management. The SMS Blackwell
handbook of organizational capabilities, pp.422-426.
Denning, S., 2017. The next frontier for Agile: strategic
management. Strategy & Leadership.
Bonsu, S., 2019. Strategic management: The concept of competing with
self. Journal of Marketing and Management, 10(2), pp.20-44.
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