Strategic Analysis of Tesco's Business Strategy Report

This report provides a comprehensive analysis of Tesco's business strategy, focusing on strategic planning and the application of various business models. It begins with an introduction to business strategy and its importance, followed by an overview of Tesco. The report then delves into Tesco's strategic planning by applying Porter's Generic Strategies (Cost Leadership, Differentiation, and Focus) and Bowman's Strategy Clock. It examines Tesco's mission, objectives, strategies, and tactics, including its online shopping experience. The report interprets the information and data to assess Tesco's competitive advantage and concludes with a summary of key findings and references. The analysis highlights how Tesco can leverage these models to gain a competitive edge in the market.

Business Strategy

Table of Contents
 Introduction
 Strategic planning for Tesco by application of different models
 Strategic Management Plan
 Interpretation of information and data
 Conclusion
 References

Introduction
Business strategy can be defined a set of actions that can be used by businesses
to attract customers, remain competitive and increase their overall sales. It
guides a business on how can it reach its goals and objectives in the most
efficient way possible. Organization chosen for this presentation is Tesco, which
is a multinational groceries brand headquartered in England. The company was
founded in the year 1919 by Jack Cohen in Hackney, London.

Strategic planning for Tesco by application of
different models
There are different strategies that businesses can use in order to attain their
goals and objectives effectively. These strategies can help the respective
organization, i.e., Tesco to attain desired results. The strategic model for
the company by using different theories is explained below-
 Porter’s Generic Strategies
 Bowman’s Strategy Clock

Cont…
Porter’s Generic Strategies
It is a set of strategies that can guide an organization about how can it gain a
competitive advantage against competitors in the market. The three strategies are
as Cost Leadership, Differentiation and Focus Strategies.
Cost Leadership – If a company adopts this strategy, the min objective behind
the same is to become the lowest cost producer in the market. Tesco can adopt
this strategy and offer its products and services at the lowest price possible.

Cont…
 Differentiation Strategy – Differentiation strategy involves making the
products and services innovative and different from other companies in the
market. In order to gain competitive advantage through this strategy, an
organization should carry out a research about its competitors as well as adopt
different ways to promote products so that the customers will understand the
benefits that the company is trying to market.

Cont…
 Focus Strategy – Companies that adopt focus strategy primarily focus on a
particular market, understand the unique requirements of the companies and
accordingly develop specific products that are priced at affordable rates and
are not heavy on the pocket. Also, since these organizations cater to a
particular market, they have a high brand loyalty among customers. If Tesco
adopts this strategy, it will be able to stand out in the market against
competitors.

Cont…
Bowman’s Strategy Clock
It is a strategic model that can be used by organizations to analyze their
competitive position as compared to different competitors. The model was developed by
Cliff Bowman and David Faulkner. The primary focus of the model is on making
companies aware of their position within the market.
 Low Price and Low Value Added – It is not compared to be a very competitive
position for a company. The product is not differentiated and the customers do not
have a lot of information about the products and services of the company.

Cont…
 Low Price – Tesco does not charge a very amount of its products from the
customers and is thus considered to be a low-cost leader in the retail market. The
profit margins on every product of the company is low but the volume of output
is high.
 Hybrid – This position involves some part of low price as well as some part of
the differentiation. If value is consistently provided to the customers, this
position can prove out to be very effective.

Cont…
 Differentiation – The main focus in this position is to provide products
that are of high quality and require strong brand awareness. Branding as
well as the quality of products play a major role in this strategy.
 Focused Differentiation – The main objective of this position is placing
the product at high price levels due to which the customers buy the
products due to their high perceived value in the market.

Cont…
 Risky High Margins – This position involves high risk wherein a business
sets high price of products but does not provide anything extra.
 Monopoly Pricing – In this strategy, the organization offers a specific and
fixed price for particular range of products in the market.
 Loss of Market Share – In this strategy, the customers do not purchase the
products of the company because of their high prices which therefore, leads
to a loss in the market share.

Strategic Management Plan
Mission – The mission statement of Tesco is to make products that are
better than its competitors.
Objectives – The primary objectives of Tesco are –
 To provide its various products like groceries, clothing and electronics
online to the customers.
 To develop a seamless online shopping experience for its customers.