Analyzing Tesco's Digital Transformation: Business Models & Impact

This report explores Tesco's adoption of digital business technology, highlighting key trends, emerging business models, and associated challenges. It examines the advantages of digital technology, such as social connectivity, versatile working, and automation, while also addressing the complexities of virtual business, including communication issues and project management difficulties. The report discusses servitization, dematerialized, and virtual business models, evaluating their potential for Tesco. Furthermore, it addresses cybersecurity and ethical concerns, emphasizing the importance of confidentiality, security, and whistleblowing prevention. The impact of collaborative relationships and strategic alliances through digital technology is also explored, along with the influence of cryptocurrency on Tesco's business, including the impact of recent market crashes. The report concludes by summarizing the key findings and emphasizing the importance of digital transformation for Tesco's continued success.

Business

Table of Contents
INTRODUCTION................................................................................................................................4
MAIN BODY.......................................................................................................................................4
Key trends and advantages of digital technology............................................................................4
New and emerging digital business models.....................................................................................5
Cyber security and ethical issues.....................................................................................................7
Impact of new collaborative relationship and strategic alliances through digital technology .......8
Discussing the impact of crypto currency on businesses.................................................................9
Impact of recent crash of digital currency on businesses..............................................................10
CONCLUSION...................................................................................................................................11
REFERENCES...................................................................................................................................12

INTRODUCTION
The term digital business technology is referred as the advance use of technology which is is used
to create new business models and ideas which can further help the business and the organisation to
stay dynamic according to the present world. The digital business technology is used to increase
the customer's experience, increasing the productivity and functional ability of the company by
performing the tasks and activities effectively and efficiently(Abdelaal Khater and Zaki 2018)
Digital technology is being opted by various business and organisation so as to achieve the
organisational goals by increasing the efficiency by using advanced technologies and upgraded
version of software(Agarwal and Narayana 2020). The digital business technology platform
combines various IT structures and business assets to create and exchange the services. This report
is based on Tesco which is the third largest retailing company of UK. Tesco is a well known reputed
company which is using digital technologies and upgraded version of technologies to encourage the
Business and to increase its sales by managing the tasks and activities effectively and efficiently.
MAIN BODY
Key trends and advantages of digital technology
Digital technology has improved nearly every facet of modern life. Travel, work, shopping,
entertainment, and interactions are just some of the areas that have been changed in recent decades.
It’s now rare to find an electronic gimmick or piece of machinery that doesn’t unite digital
technology in some way. Tesco is the excellent retailing company which is following a tall structure
of hierarchy as the organisation has various tasks and activities which are required to be performed
on a daily basis. the Tesco company is spread on a global level by gaining various benefits and
advantages so that it can increase its sales and can gain more and more profits by managing the task
and activities effectively and efficiently. The digital use of technologies and other other upgraded
software can help the company to increase the productivity and it can also maintain the work force
in an effective way(Boojihawon and Ngoasong 2018). Given below are some advantages and key
trends of digital business technologies which can help the Company to manage its functions.
 Social connectivity
Digital technology can help the various business and organisation such as Tesco, to stay in touch
with their customers from different segments of the market which can help them to be more social.
The better communication and interaction can help the company to stay dynamic according to the
needs and wants of the company.

 Versatile working
The managing of proper functions are needed which can help the company to stay versatile and can
promote multitasking. The versatility of the company can be increased by the help of digital
business technology. The company is expanding its operations and promoting the Offline and online
mode of working by which it can perform its tasks in an easy and convenient way and the
customers can also be attracted by opting the online mode of shopping(de Sousa Jabbour 2018).
 Automation
Digital technology is progressively going machines smarter. the machines no longer need humans
to start them, liberating the workers from often slow tasks for more interesting movement. In other
cases, smarter devices mean better standardised of safety or a better experience for the individual.
Managing the virtual is not an easy task as it has a lot of pros and cons which can effect the
business and the organisation. Tesco is promoting its online grocery shopping it needs a various
types of strategies and tactics so as to promote the effectiveness and efficiency of the tasks. Tesco is
a large organisation which has various operations which are needed to be conducted on a daily basis
so that the issues and problems can be avoided which can be helpful in managing the tasks and
activities on a good level. There are a lot of challenges and problems which can be faced by the
company by encouraging the virtual business such as, Improper communication with the team
members which can result in the high stress levels and conflicts. Difficulty in managing the remote
projects and task management(Gauthier Bastianutti and Haggège 2018).
New and emerging digital business models
Between fast scientific development, an increasing focus on property, and the rise of remote work,
today’s organizations are operational in a rapidly-changing enterprise environment.
To stay applicable, organizations are constructing their business models, to meet the needs of the
customers of today.
There are a lot of business models which can be opted by Tesco so that it ca perform effectively and
efficiently by managing the activities in a proper way. There are a lot of issues which are faced by
the Various business and the organisation by which the productivity can be decreased and the
functional ability of the workers and the employers also reduced. Tesco is a large company which
has a lot of operations which are required to be managed on a daily basis(Ghosh and Rajan 2019)
The company can opt different business models which can also protect its data and can secure its
privacy concerns so that the company can perform actively. Given below are some of the business
models which can be adapted by Tesco so as to promote the cyber security and ethical issues
 Servitization business model

This model is related to the switching from products to services. This model is stated as the one in
which the customers pay for the service rather than the purchasing of goods. There are a lot of
business and organisation which are using this business model o that they can attract more and more
customers by their effective and efficient services. According to various reports this business model
generates more than two thirds of the Gross domestic product and the companies has also sold the
products through this.
 Dematerialised Business model
This business model is referred as the one in which the business promote towards the renting of
goods instead than buying them outright. This model also helps to wage into the increasing trend of
dematerialize. In this model the companies deliver the same merchandise or service they always
have, but use fewer physical resources. This tendency is being impelled in large part by a growing
awareness of property issues in both businesses and their customers. This business model also been
in trend as it increases the social awareness and other social information are also provided by the
model which can further be helpful in encompassing the circular economy. Tesco can use this model
by making people aware about the Environmental concern and the company can also promote
sustainability through its product and services so that it can not create any harm towards the
environment (Hou and Shen 2022).
 Virtual business model
The term virtual business model is considered as the most important model as it is being opted by
various business an d the organisation so that they can promote their business on a great level. Tesco
is also switching to the virtual business model so that it can maintain an effective and efficient
approach to perform the various tasks and activities. Virtualization link up to the creating of virtual
preferably than physical, goods and services. Dissimilar to the digitalisation, which moves current
physical services into the digital arena, virtualization has the possible knowledge to create brand-
new employment and virtual products. The Tesco can use virtualisation Business model so that it
can multi task and can succeed all the activities which are considered as important for the business
such as, stock list controls, machine running, delivering and other supply chain tasks.
Cyber security and ethical issues
The world is being more and more open towards the technological advancements and it is also
opting various types of technologies and upgraded soft wares so that it can promote their tasks and
activities at an easy level which can create the effectiveness and efficiency of the organisation. The
Tesco company have to maintain a large amount of data so that it can keep in track the data of
various customers and the workers. The Business models can be opted by Tesco so that it can avoid
various issues related to cyber security and ethics. Given below are some of the issues which are

related to the cyber security which can Affect the business.
 Confidentiality
The term confidentiality plays an important role in the cybersecurity as it is the basic requirements
of the various business and organisation so that they can maintain their track records and other
information private. The security professionals are opted to maintain the effective cyber security so
that the important data can be kept in a good way without any transfer of information.
 Security
The term security is referred as the issue which is related with the privacy and other concerns which
are needed to be looked by the various business and the organisation such as Tesco. Security is the
basic requirement of the company so that it can protect its necessary data and other security based
things which are needed to protected so that the company can maintain its good security position
without any risk of leakage of data and other information.
 Whistle blowing
The Whistle blowing is the term which is related with the issue when a member of the business and
the organisation leaks the private and secured information to the external members. The whistle
blowing I considered as an unethical component which is avoided so that the Business and the
organisation can maintain an effective and efficient position in the long run.
These were the Cyber security issues which should be avoided by the Tesco som that it
can ,maintain a well known reputed position in the long run along with managing the proper data
and other security terms. The above mentioned Business models can be opted by Tesco Plc so that it
can be effective and efficient enough to manage the tasks and activities.(Manners Bell and Lyon
2019). The cyber security and Ethical issues are referred as the most common issues which can be
faced by the company as it is having a large amount of data which needs to be addressed on a daily
basis so as to avoid the chaos and other issues which can Effect the managing and the working of
the organisation. The Tesco plc is also paying more attention towards opting the Virtual Business so
it needs more privacy and Security to manage its data and security.
Impact of new collaborative relationship and strategic alliances through digital
technology
Collaborative relationship is a process in which two or more individuals perform in a uniform way
to achieve organisational goals. digital transformation is entering in almost every field and industry
and organisations are going digital to increase their productivity and performance. Organisations
are using different technologies to engage with more and more customers. A company get facilitated
by technology in various ways, it is not only concern with data intelligence, customer centric

approach, new value proposition and innovation but it also reduces cost, enhance efficiency and
make companies operations efficient and effective.
Digital collaboration help Tesco to navigate more customers in business and satisfy their needs by
offering product and services they need. However the path of digital transformation bring various
challenges that company may need to face. Tesco has been constantly investing in technology so
that they can develop an omni channel consumer experience and maintain a competitive advantage
in the business. Some digital advancements that had impact on Tesco's business are mentioned
below -
Tesco Direct – When the United Kingdom was on the prime of their online grocery purchase. The
company was quick to respond and adopted new technology to grab the opportunity. Tesco
introduce their online distribution channel “Tesco Direct”. Online sales were growing at that time
and company made some changes in their operations and made warehouses particularly for online
orders fulfilment. The company also introduced click and collect function which helped customers
to collect their orders from different collection points of their choice. Introduction of this
technology also brought many challenges for Tesco. They made heavy investments in developing
their online platform also they established warehouses which was also a challenge for the company.
Development of Tesco Club card – The company launched “Tesco Club Card” which was a
customer loyalty scheme. For implementing this scheme the company needed to create a unique
customer ID for every purchase. This resulted in amalgamation of loads of customer data. Tesco
used data analytics and algorithms to improve their supply chain and product portfolio. The data
analytics technology also helped company to predict customers purchasing behaviour by which they
can create personalised ads and discounts for the consumers(Stöckl and Struck 2022).
Digitalised in store experience – To increase the efficiency of their operations, the company uses
various technologies. Self checkout stations help customers to perform check out function with out
the help of Tesco's employees. This technology allows customers to avoid the long checkout queue
and make Tesco's operations smoother. This technology also reduced the cost for Tesco because the
company need fewer employees for checkout process. The self checkout process also bring
challenges for Tesco. Low employee supervision at this process can lead to fraud for the company.
In store cameras help employees to detect which aisles are depleted and electronic labels allow
Tesco to make instant price change.

In a strategic alliance two companies work together for their benefits. Tesco can make alliance with
any digital marketing company which can help Tesco in improving their digital marketing
campaigns and strategies. To gain a competitive advantage in industry every company need to make
strategic alliances so that they can minimise their weaknesses with other companies help. When
companies work together they bring their specialisation which makes it easy to complete any given
task.
Discussing the impact of crypto currency on businesses
Crypto currency is a type of online money which is nowadays used by many peoples to perform
various activities. The currency has been circulating around the world and it is established in some
markets. Cryptographic algorithms are used to record the transactions of such currency. There are
different types of crypto currencies that regulates in the market and many individuals are using this
currency and transforming their practices (Zutshi Grilo Nodehi 2021) The crypto market is growing
and many individuals and businesses are using it in order to make profit. There are different types
of crypto currencies like Bitcoin, Dogecoin, Ethereum etc. In this new digital era the companies are
changing the way they operate and are allowing customers to pay in digital currencies. Customers
can now use Bitcoin to pay which is a digital currencies. Tesco has always adopted new technology
and innovations in their business. Tesco has also started accepting Bitcoin, however the customers
can only purchase Tesco gift card from the digital currency.
Impact of recent crash of digital currency on businesses
Cryptocurrencies is no longer booming and the value of world's leading cryptocurrencies has gone
down. The value of bitcoin crashed due to the crosswind in the global economic environment and
various scandals. Central banks around the world has increased interest rates in recent months.
Various different currencies are facing major fall in their value. Nowadays when business are
implementing modern business transactions the downfall can create a huge problem for them. In so
many countries the digital currency is still not legal which is the major drawback for the currency.
Different countries have different opinions on the digital currency which created uncertainty in
peoples mind. The viability of digital currency is low because of such uncertainties and changing
market conditions. The crypto market collapsed due the viability and security problem which arise

in recent times. The technology is still not developed significantly and there are security issues
which arise with the increasing use of digital currency. There are many reasons for the crash of
crypto currency and some of them are mentioned below -
 Digital currency is not legal – The major reason of the downfall of currency is the different
opinions of different countries. There is a big list of countries which have banned the use of
digital currency is restricted or illegal. Governments are not making it a legal tender and
that is a big reason behind the downfall of the currency (Xu Yang Zhang 2022).
 The equity market – The equity market is linked with crypto market. If the stock market
falls the same happens in the crypto market. In last few months the prices of digital
currency perform similarly to the equity prices. Ideally the crypto market should perform
independently from the traditional market. The digital market has become sensitive to the
mainstream market which is also a cause of digital market fall.

CONCLUSION
The above report went into detail with various complex issues such as digital business as well as
their emergence in the new industrial sectors. The report have concluded that the various Business
and the organisation needs different types of technological advancements so that they can perform
effectively and efficiently. Further more, The main focus on Understanding the recent crash on the
Digital currency was also detailed along with the various reasons which are making the downfall in
the currency. There are various business and the organisation which are implementing new ways to
opt the digital transformation along with strategies and tactics which can be helpful in promoting
the Business. Including this, The Evaluation of Digital technology and various Business models
were also described which are acting as the major role in promoting the growth of the organisation.
At the end the Various advantages are also highlighted which can be used by the company so that
they can provide better services to the customers.

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