Tesco Plc: Performance Management and Strategic Analysis

This project presents a comprehensive case study analysis of Tesco Plc, examining its performance management strategies and business operations. The report is divided into three projects. Project 1 describes the case study of Tesco Plc, detailing its history, global presence, and strategies for organizational performance management, including performance planning, appraisal, feedback mechanisms, and reward systems. Project 2 explores the impact of push and pull factors on Tesco's operations and considers future implications of its approaches. Project 3 focuses on the role of business functions in Tesco's success, tracking strategic changes over the last decade. The analysis includes market share data, strategic business plans, and performance management tools and techniques such as ranking methods, critical incident techniques, and feedback mechanisms. The report highlights Tesco's evolution and its strategies for maintaining a competitive edge in the retail industry.

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Table of Contents
INTRODUCTION...........................................................................................................................1
PROJECT 1......................................................................................................................................1
Describing the case study of Tesco Plc.................................................................................1
Ways by which organisation currently manage its performance............................................3
Recommendations for Improvement.....................................................................................9
PROJECT 2....................................................................................................................................10
Critical understanding of how push and pull factors operate in Tesco plc..........................10
Future Implications of approaches applied..........................................................................12
PROJECT 3....................................................................................................................................13
Role of business functions for the success of organisation.................................................13
Tracking changes of strategies and strategic direction over last 10 years...........................23
CONCLUSION..............................................................................................................................26
REFERENCES..............................................................................................................................27
Illustration Index
Illustration 1: Market Share of Tesco..............................................................................................3
Illustration 2: Communication Process in Tesco.............................................................................8
Illustration 3: Marketing mix of Tesco..........................................................................................14
Illustration 4: Product Share of Tesco...........................................................................................15
Illustration 5: Market share of Tesco.............................................................................................16
Illustration 6: Recruitment and Number of employees in Tesco...................................................19
Illustration 7: Selection process of Tesco......................................................................................20
Illustration 8: Methods of training ................................................................................................21
Illustration 9: Market share of Tesco.............................................................................................24

INTRODUCTION
Organisational performance management is a process which identify and determine that
all the company's resources are fully utilized by the departments or not. This concept is applied
for the development of employees (Nielsen, 2013). Thus, all the managers and staff members
need to develop effective charts by which they can monitor every activity related to the
organisation. The present report present the managerial function of Tesco plc company. Whole
report is divided into three projects. In project 1, it describes the case study of Tesco plc and
explain how company can manage its performance. In second project, it describes the critical
impact of push and pull factors for making effective operations in an economy. It also describes
the future implication of approaches which are applied by the company. At last, in the third
project it explain the role of business function for the success of the organisation. It also include
various kinds of recycle which are used by the Tesco plc and explain steering wheel process for
making effective communication process with employees.
PROJECT 1
Describing the case study of Tesco Plc
Tesco plc was founded in 1919 in London, UK. Tesco is the world's third largest retailer,
which employed 520000 staff in 14 countries. Company operates it total stores in 6251 location
across the world. Company has diversified geography by which organisation deal with software,
furniture, telecom services and many more. Tesco built various strategies for ensuring it growth.
By managing customer's relationship company uses new internet techniques etc. and expands
their business in a global market. By managing organisational performance, Tesco try to ensure
the business goals by effective managing their employees (Van Dooren, Bouckaert and Halligan,
2015). All the performance managing process presents that company manage their employees
and goals by using appropriate strategies. In addition to this, for implement the organisational
performance management, company adopt integrated training facility to their employees by
which staff can attain the performance management goals. Company also apply six component
for managing their performance, these are:
 Performance planning component: In which company make proper plan related to the
performance. It include factors which make impact in performance planning of Tesco plc.
It include all the physical factors like motor skills, conditioning, space, nutrition,
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flexibility and medical activity etc. Technical factors include all the tracking skills, ball
control, movement & footwork, developing weapon etc. By using tactical factors in
consider the placement, consistency, patterns, spins, power of employees. By using
strategic factors it include repetition, surface etc. Mental factor consider the employees
situation and want like self- esteem, confidence, discipline, goal setting and
environmental factors includes fun, home, social, economic and competitive position of
employees in their working place.
 Performance appraisal and review: Tesco plc analysis the performance of employees by
monitoring their each and every activity. Organisation also use 360 degree feedback,
emails etc. by which manager of the company get feedback from the customers and staff
members. In order to this, company make effective changes as per the need.
 Feedback mechanism: It is an important part of the business. By using this Tesco make
effective changes and improvement for achieving their goals. Company uses steering
wheel concept by which firm will receive effective feedback from the employees. By
using social media network like Facebook, Google, Twitter and online website company
will receive view from the customers as well as employees and after that company make
appropriate changes or improvement in their operational activity.
 Pay and reward systematic: In include all the reward system which is given by the
company to their employees. It include extra payment of wages for doing extra work,
incentives, bonus etc. For example: Company provide cake and gifts on the occasion of
Christmas and Valentine day to their employees. Firm also provide health and hospitality
services to their staff and their family too.
 Performance improvement plans: Tesco use various kinds of training and developing
techniques. It include on the job and off the job training facility by which employees will
develop new skills and ability to adopt innovative changes and prepare for facing future
risk (Zhu, Sarkis and Lai, 2013).
 Future appraisal: It includes all those activity which help to determine the financial
position of a company. For example: Preparing cash flow statements, income statements
and balance sheet.
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All these components help the company to analysis the performance of an employees and
managing all the activities for accomplishing the goals.
Ways by which organisation currently manage its performance
Tesco is a public limited company which was founded in 1919 in East London. It is retail
stores which provide all type of products or services to their customers in worldwide level.
Company adopt various strategies so that it can manage its performance and accomplishes its
goals.
High Level Aspirations Expressed as Outputs and Outcomes
To create value for customers and earn loyalty from them is the main target of the
organisation. Company adopt core strategies to make growth in UK market and create a highly
credited brand. To build effective team work in an organisation, Tesco create more values. By
using all this strategies troupe can achieve the target and also manage performance of employees.
By managing the organisational performance, company achieve 29% of UK market share.
Illustration 1: Market Share of Tesco
Source: (Tesco Plc. 2017)
As per the above chart, it shows the market share of different retail companies. As
compare Tesco from other companies like Sainsburry, Aldi, Asda, Lidi etc. the result shows that
Tesco acquire highest number of market share in UK with 29% in 2014. It means that company
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is in great position to acquire highest number of customers by using innovative strategies. To
manage the performance and determine the actual requirement of resources for managing the
work company uses various activities. As a results, company total number was increases with
6553 stores in 2017. The total revenue of company will be increase with £55,917 million and
operating income will be £1280 million in 2017. Company's net income also increases with £54
million. All these ratios and data make positive impact in growth of a company. As a result there
are 476000+ people employed in a company. Tesco also develop their subsidiaries like Tesco
Stores Ltd., Tesco Bank, Tesco Mobile, Tesco Ireland, Tesco Kipa, Tesco family Dinning Ltd.,
Dunnhumby and Spenhill. In this way, by managing the performance and determining the
sources availability help the company to expand their business in world wide level.
Strategic Business Plan
Tesco rank itself as a large retailer in the UK market. It focus to create the shareholders
values by using innovative techniques and also focus on satisfaction of customers. Company uses
strategies like to serve the services in the society, to expand their business in global level. The
sales of Tesco is higher in comparison of its competitors. It also provide excellent services to the
customers and expand itself geographically. Company also adopt some latest business plan they
are as follows:
 Tesco will take acquisition over Giraffe and decide to invest as shareholders in
Euphorium bakeries.
 Company will invest money in small and online stores specially in Europe and other
foreign markets.
 It also face trouble in US market so that firm will quit from US and Japan market.
 It will invest £150 million in online business by which it can beat the competition
situation in a global market.
With respect to expand the business and managing the performance, company need to
make a strategic plan. Tesco will focus in their customers and identifying their needs. It also
ensure to create a strong supply chain network in Switzerland by which company can manage
their work effectively. It also try to active and participates their members for taking part of
corporate social responsibility campaign. Organisation mainly focus to expand their business
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operations in Switzerland. In purpose of this company try to make the good brand image in
Swiss market so that it can be recognized globally in retail market. Tesco also develop[ various
strategies options like Ansoff model. As per this model, company always try to develop their
new product in Switzerland. By adopting various strategies which is related to the food and non-
food items, company develop itself in a new market. They also try to segmenting, targeting and
positioning their strategies for entrance in a Switzerland market. Hence, by using all the effective
strategies and methods company will manage their performance and achieve their goals in world
wide level. As per the research, it is found that by using effective strategic business plan firm
now gives employment opportunities to 476000 peoples, its gross sales is increases with 48.4
billion pound. Firm also try to rebuild the trust and transparency with their customers by
providing high quality products.(Ruys, Geleijnse, Henrichs and Utens, 2013).
Performance management Tools and Techniques
Tesco uses various kinds of performance management tools and techniques by which it
can analysis the actual position in a market. All the techniques helps the organisation to
determine the level of performance of their employees for completing the task. Company use
following techniques for measuring the performance, theses are:
Ranking Method: This method help to giving ranks to their subordinates as per the
performance. Company use the ranking method by which managers can analysis the current
position of their subordinates. For example: Tesco's manger found that by using ranking method,
there are 24500 employees who completed their work before the prescribed time in UK stores.
This method is useful for the company because by using this techniques managers can estimate
their actual performance level. It is a simplest process to find out the best and worst employees at
workplace (Pollitt, 2013).
Critical Incidence Techniques: This techniques help- the company to determine the
performance level of an employees by making discussion with the seniors. By using this
techniques, company can find out the actual labour turnover and new joiners in an organisation.
For example: Tesco found that in 2015, employees leave the organisation because of the low
incentives and harsh behaviour of the leader. Company analysis that leader use autocratic
leadership style in their workplace in which employees did not give any kind responses freely
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but now a days, firm uses democratic leadership style in which employees are freely engaged in
decision-making process.
Feedback: It is a most common and powerful techniques which company can use to
examine the actual performance level of an employees. By receiving the feedback from
employees help to identify the conflicts and any kinds of disputes in a department. Tesco will
take the feedback through questionnaire, telephone, mail etc. Today firm also uses Club card
which provide to get complete details of every activities which are performed by the staff
members.
Performance Test: By testing the performance is a best way to analysis the performance
level. By using this techniques, company can find out the level of task perform and eliminate the
employees which dopes not give any kind of help for the growth of the organisation. Hence, by
using all these techniques and tools Tesco can analysis the level of performance of every
employees. In order to this, company take effective course of action for increases the
performance level of employees and achieve their goals (Tomlinson, 2013).
Targets
To manage the performance, Tesco targets their customers and employees. In customers
perspective, company always try to provide high quality products in affordable price. Company
also targeted their customers by diving them into two groups: poor and rich people. Organisation
always try to develop and provide all those products or service which satisfied the demand. They
deal with diversified areas so that firm always try to maintain the quality and price of each
product. On the other hand, in employees perspective company also provides effective training
and development programme by which it can create skills, knowledge and ability to the
employees. Tesco also give motivation and also receive time-to-time feedback from them.
Hence, by managing the performance of organisation, managers of a firm try to increases their
competitive goals in a global environment. Firm wanted and needed around the world by using
innovative, modern ideas.
Implementation and Monitoring
For implementation of performance management techniques, Tesco plc monitor each and
every activities of employees. Company also try to maintain the relation with employees. In
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order to this, company uses steering wheel for seeing the objectives of performance. According
to this, each quadrant in a wheel is divided into targets. By making the annual budget company
also analysis the actual cash requirement in an organisation. This process help to make effective
determination of cash requirement by which company will allocate their resources efficiently.
Company analysis each target or department's activity and after that take effective decision for
achieving the desire goals. Tesco also use E- Business tools, by which it can analysis the
performance of employees by using different methods like social media, open sources, RFID
techniques etc. Organisation also uses the social networking sites like Facebook, google for
analysing each activity. In this way, company can implement their activities and strategies for
managing the organisational performance (Ates, Garengo, Cocca and Bititci 2013).
Measurement of Results/ Verification
Measuring the results of managing performance can be done by using balance scorecard
of a company. Balance scorecard is a summary of each and every activity which presents the
financial position as well as level of performance of a company. Tesco monitor their staff to
make correct decision that employees will perform as per the prescribed standard or not. For
example: By measuring the performance of employee help to determine the actual sale during the
year of a company. Tesco also set their smart targets by which employees can meet their
requirement in a job. For example: On Shelf Customer availability is also a smart target of
Tesco, which provide surety that customer will get every product in a single store. Company uses
the Steering Wheel for measuring the performance. It include identification of people, finance,
customers, operations and community. They also uses the disciplinary policy which have three
stages, verbal, written and final.
Communication and evaluation
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Illustration 2: Communication Process in Tesco
(Source: Van Der Aalst, 2013)
As per the above flow chart of communication process of Tesco shows that firm uses
video interviews, blogs which are centralised with the company's websites. They also uses
different social networking sites to stay connected with the employees. As per the research, it is
found that company attract and communicate approximate 1460000 people across the world.
Tesco will communicate their employees and customers with the help of blogs,websites like
Facebook, Twitter, Email etc. In this way, manager of a company will get the feedback of
customers which is related to the products or services. By using emails company can determine
the situation of each department. Company also use different communication medium like
verbal, written communication so that effective information will be deliver to the employees. By
using social media networking sites or preparing website help to make effective interaction with
their customers and employees. They also send questionnaire or make telephonic interview so
that manger of the firm will analysis the conflicts and take effective action as per the
requirement. Hence, company use effective communication channels for delivering the best
results to the employees and customers.
Sensitivity and commitment
Tesco also give commitment to the customer to provide high quality of products with an
affordable prices. Company always deals with diversified market and geographical areas. They
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also try to expand their business by focusing on the satisfaction level of customers. On the other
other, company also gives best employment opportunities to the people. They expand their stores
in 24 countries so that large number of people are employed in the organisation.
Recommendations for Improvement
Tesco always try to manage their performance level but company need to be some
improvement for managing the performance, they are as follows:
 Company need to make link between performance management projects and goals.
 Tesco plc should give more focus on rating system by which company can analysis the
best and worst employees.
 They need to developing a performance evaluation program
 Providing training and development of employees so that they can adopt new innovative
techniques in their workplace.
 Setting date of reviews in advance.
 Company need to improve their development plan, like revised salary structure, working
hours etc.
 Provide motivation to the employees, it may be in form of monetary and non- monetary.
 Company always try to maintain the effective relationship between employers and
employees (Zhu, Sarkis and Lai, 2013).
 Organisation try to maintain the complete of their financial transaction through balance
sheet, income statements and cash flow.
 By reviewing the process is a best way to make improvement in the business operational
activity.
 Tesco plc should provider fair compensation to their employees so that they will perform
in an effective manner.
 By developing the managerial competencies is an effective to make business grow.
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 By setting company's clear goals and analysing the actual position through SWOT
analysis, benchmarking, trend analysis and webinars help to improve the company's
growth.
PROJECT 2
Critical understanding of how push and pull factors operate in Tesco plc
For launching and advertising products in market, different strategies are applied
including push and pull for competitive advantages. It is related with creating innovations in
business operations as well increasing its strategies for promoting goods provided by entity
effectively (Amirkhanpour, Vrontis and Thrassou, 2014). However, Tesco is to present its
creativity in snacks of different varieties. Therefore, marketing strategies used for launching
new creation and different factors impact on it can be expressed as:-
Push strategy and its factors:- It is a kind of selling approach in which dealer presents
all quality features of innovative products for increasing in demand for goods and competitive
advantage. Under this approach, product is made according to organisation and its decision
makers' choice. However, seller approaches customer to purchase goods therefore s profitability
of organisation can enhance. The main motto for using this strategy is to increase revenue of
entity only. It does not focus on maintaining relationship with customers and providing services
according to their needs and all (Anche, Hozouri and Mehdizadeh, 2014). Likewise, some factors
impact on push strategies for marketing of innovative products provided by Tesco can express
as:- Setting up distribution channels:- For using push strategy to create marketing for
snacks, different distribution channels are analysed for providing goods and services to
customers at large scale. In accordance to this, all mediums to reach out consumers are
recognised to sell products and increasing profitability of Tesco. Thus, on the basis of
place for selling products, all marketing determinants are identified for enhancing
production and distribution system (Biggemann, 2012). Attractive advertisement of goods:- Advertising manner for innovative products involves
in push strategy for marketing of goods and services. In this regard, various tools are used
for selling products and launching in market for increasing competitive strategies. Thus,
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