CW2: Tesco's Innovation Roadmap: A Business Development Report

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CW2: Individual Report: A full report comprising an action plan
roadmap for the development and implementation of the innovation
capabilities of the chosen organisation.

Executive Summary
The following report concerns an innovation road map for the organisation of concern. The
learner has applied an evaluative approach to the source of facts and business datum. The
methods that are appropriate for the drive required for innovation in context with the external
environmental factors have been taken into account here. The organisation and its leaders
continuously trying to manage the innovative process have been highlighted. Organisational
expertise and knowledge is at the helm of the innovative process and has been successfully
exemplified.
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Table of Contents
Introduction, purpose and structure.................................................................................................3
The future of the industry 2020 and beyond....................................................................................4
The organisation innovation requirements 2020 and Beyond.........................................................5
Building innovative capabilities for the future of Tesco.................................................................7
Conclusion.....................................................................................................................................14
References......................................................................................................................................15
Appendices....................................................................................................................................17
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Introduction, purpose and structure
The company that has been considered for the sake of the report is Tesco, PLC which is one of
the leaders in supermarket chains in England and probably also worldwide. An action plan is
however underway for creating something better from the global perspective. Since the rise of
veganism and “keto” diet concepts the buyers have become more conscious about what they eat
and whether it is processed artificially or not (Tesco.com, 2019). Tesco is giving consumers the
option to choose between animal products and non-animal products by promotion of meat
alternatives being kept next to the meat aisle so the concept is that innovation may not just only
be in terms of creation newer products but also the way it is being promoted under the brand
name.
The purpose of the report as explained above is to engender more of innovation on the lines of
environmental sustainability supporting community-based development like that of trialling of an
opposite vending system in the United Kingdom where the buyers are rewarded with money for
returning of plastic bottles under Tesco. This drive will make the system better for people
through an active action plan as it provides incentives for the buying individuals to consider
environment issues more seriously.
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The future of the industry 2020 and beyond
The future that is being predicted is definitely brighter in terms of Tesco as it is becoming a
healthier and more LGBTQIA friendly zone preferable for employees who help in innovation as
much as the Research and Development team. The way Tesco takes care of the mental well-
being of the employees is like no other as they believe in leading by example. The effect of
having rituals like going meat-free once a week is making the industry which is mainly food
innovation driven to provide for more meat alternatives like soy-filled burgers (Jordan, 2018).
Shopping trends are changing vastly as start-ups like Allplants in UK and several others are
coming up with customised plant-based alternative meals which come for a good price. Tesco
has been trying to make vegan and flexitarian options more viable in terms of price and ready-
availability by providing ready-to-cook items also. If a future forecast is possible then the
industry is leaning towards creating a more viable environment for banning the usage of non-
biodegradable plastics (Zhang et al., 2018). Since search-based shopping is greatly preferred
worldwide, shoppers are looking for a more curated experience meaning asking for the
incorporation of touch-screens and activated iPads within the stores for a more logical approach
towards showing what products are available and out-of-stock (Sansone, 2016). They are also
invaluable as they serve to be crucial for finding discount coupons, checking of weekly
advertisements and price-point comparison and bargain of values. The customers are looking
smart dressing rooms with digital search panels for the handicapped section especially for
relationship enhancement and most importantly the fun factor. As of today every one out of the
three modern-day shoppers are bargains-driven and ninety-three percent of the so-called
“generation Z” shoppers shop in terms of bargain retail so Tesco may lose out on some loyalists
who are bargain hunters. Although online commerce is becoming more relevant it is supposed to
make shopping seem more life-like. The future is more data analysis and logistics driven which
is being utilised to the hilt by leveraging Science and machine-learning for better insight into
what the retail customers would like. Algorithms that allow applications like Netflix to customise
choices will be installed to appropriately suggest choices in the retail business. Methods are
being recalibrated for the enhanced awareness taking the help of public platforms as the new
generations believe rely more on being online constantly. The condition of annual sale or
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clearance is dying a slow death as the companies are looking to find more lifelong members who
shop whether there is a sale being organised or not. Tesco has already started shipping clothes
abroad but future retail loyalists are looking for better clothes line in terms of sizes for all
especially for the plus-size people. For plus-sizes there are plans of the retail sector for making
commercials that include them as well. The companies are largely partnering up with
applications to be designed in such a way that the smart bands that they wear for fitness will also
allow them to pay for retail goods.
The organisation innovation requirements 2020 and Beyond
Tesco is very flexible and the industry is also coming to terms with ideas regarding banning of
plastic by using resources like banana-leaf wraps for daily purchases of food items. Sale and
shipping of items worldwide is no innovation but the concept of including plus-sized women
while advertising for the brand’s clothing line can be valuable profit-wise. Shipping to Asian
countries or having Asians as loyalists may not be a new concept as well but can be made viable
through curated country-specific brand promotions of Tesco. They have already introduced
vegan chips for Christmas to propel healthy eating habits in children and they should consider
introducing the concept of plant-based meal alternatives also for the ones on kale and vegan
diets. The ill-effects of Brexit would have receded by the time it is 2025 or so and the economy
is estimated to be more favourable for retail by that time (Culkin and Simmons, 2018). Tesco is
being requested to rethink and revise their supply chains and physical stores for meeting
digitised consumer needs. Keeping convenience as the target the company will have to enable
features like mobile-checkout from the fitting rooms and innovative payment methods that
go beyond just store credit. Reduction in carbon footprints will be enabled by effective
utilisation of resources like encouragement of employees to access free solar-power scooters and
less dumping of hazardous waste in the oceans making water temperatures rise up. In order to
further the goals of sustainability for planet Earth the company will have to promote clothes
that are in cotton and other bio-degradable materials for reduced prices. Augmented reality or
AR is to be considered by featuring tablets in stores layering a simple to-do list over store maps
letting shoppers see latest product reviews and enabling fast checkouts. They need to extend
services of banking, dry cleaning and bistros as well since consumers will see it as an
extension of the already established convenience in retail culture. Customers would like a more
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personal experience so they would expect the personalised notification of sale alerts on their
phone as they enter the store itself through the brand applications. Since the attention span of
the upcoming generation of buyers is low and they are more private they will be grateful for this
kind of change. Tesco should be offering the same treatment for offering discounts during stock
clearance on their slow-moving clearance. The company will be expected to gather videos, texts
and images to share with the followers on social media. They need to create content that is
captivating and does not come across as propaganda, gimmicky, cheap or offensive in any way.
Commercial stores that survive will be the ones adopting tie-ups with social media platforms
for transforming their e-commerce capacities to excite the shoppers by having originality of
content. The consumers will have to be allowed to take pictures, make photo uploads and
share their lifestyle with their close ones when shopping and the “buy” button is expected to
be made more lucrative.
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Building innovative capabilities for the future of Tesco
Businesses will always make innovation a priority but the concept remains a mystery largely.
Companies might have grand ideas but may not know the ways of execution for bringing about a
change. Organisations can only actualise most of the ideas once they are in a position that allows
execution and implementation of the same. Capacity planning is the answer to the question of
how to get innovation to become a reality for the company (Perković et al., 2015). It is the way
in which the company determines the production capacity that is needed by it for meeting of
change in demands for products which are offered.
Even if the company is as large as that of Tesco logistical and financial capacities information is
important for capacity planning. This kind of a management method shows how the resources
can be used efficiently by projection of their production needs. It is divided into the three
following steps: determination of the level of service requirements, analysis of current
capacities and planning for the future. We will look into it further by way of description and
analysis for the company innovation in terms of manufacture of new plant-based meal
alternatives for the so-called vegans.
Determining of Requirements for Service Level: For the accomplishing this step the company
has to break down the work progress into streams or channels quantifying user experience. It
helps in getting work done much faster (Piperopoulos, 2016). The company will determine the
units of work to be done establish work quantities and set service levels. Tesco as a company
will organise the workload by someone who will do the work, the kind of work being allocated
or the working process. They will have to create a definition of the satisfactory services per load.
The workload will measure the amount of resources that is needed for accomplishing a task that
is to be carried out a unit of the task will measure an amount of the task being completed.
Something called a “service level agreement” is to be laid out with the acceptable parameters
accepted between a consumer and provider.
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Analysis of current capacity: The organisation heads will make an in-depth review of their
existing production schedule thereby evaluating capacity. They will analyse the workload along
with the system as a complete whole going by the following steps:
The company will compare measurements of the items being referenced in the service level
agreement and their aims. They will have to check usage of the multifarious resources of their
system. They will look into the ways of resource utilisation per workload and figure out which of
them will be the prime uses of each of the resources. They will be determining where each of the
workloads will spend their time. That will provide the company the required insight into the type
of resources taking the greatest length of time per workload (De Vries and Thörnvall, 2018).
Future planning: In the end after analysis has been made of the current capacity of the company
it will plan for its future. They will base the plan on the forecasted processing needs for
preventing it from overwhelming the production system. The company plans on gathering
information on the quantity of the incoming work that is expected over the forthcoming quarters.
The company will configure a better system for the level of satisfaction desired from the service
levels over the period.
The three of these steps for capacity planning will help the organisation be ready for growth in
the future. Optimum configuration makes sure the company meets the level of service
requirements by only the purchase of what the company needs to get their work done (Pinto et
al., 2017.). This process makes sure of the manufacturing process’ soundness. It offers the
company the opportunity to maximise on production output and makes itself ready for what is in
the future.
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Figure 1: The innovation funnel
Source: (Agárdi and Alt, 2015)
The commercial funnel is a great tool in the hands of the company for helping in stepping up
their production including innovation and its commercialisation of products and associated
services of Tesco. Evaluation of various factors are aided are made to be possible by this and its
impact is ultimately judged on the products and assistance involving the organisation’s decisions
(GRANDI and MASTROPASQUA, 2016). Picking up of new and myriad ideas are also aided
by this. The most common ways for having this achieved are:
Matching goals to resources and capacity: Tesco will be benefitted by the use of the funnel
concept which helps in the collection of vital data associated with the outstanding (as in rare and
exceptional) cases of the market in United Kingdom. Tesco is required to figure out the kind of
needs they will be having for production, their choices and the desires of the consumers. They
will need the correct datum of the market curve and trends by making the market research. This
will help the company in the construction of novel and more effective strategies for the meeting
of demands of the market (Dubovyk and Buchatskaya, 2017).
Risk analysis: If the company garners proper marketing ideas, they will be able to rid
themselves of the large risks that are generally linked with frugal innovation along with the
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commercialisation of their products and service practices (CIRIA‐SUÁREZ et al., 2015). These
will most likely be the rival companies, lack of funds and less of product suppliers.
Analysis of value by the application of any method of innovation (here frugal): The
company will be leveraging the most recent technical gadgets and technological innovations for
being economical and creating the accessibility of solution. The economical blow can be made
less intense by use of the bare minimum of resources (Brazauskaitė and Auruškevičienė, 2017).
Frugality can be shown by the cut down of usage of unnecessary resources and by focusing over
the product features and its application along with the allied or ancillary services (Bueno et al.,
2019). Growth may be achieved faster during the heights of demand for cheaper commodities
and the services associated with them that are to be created with a lot of caution with regards to
the expenses being incurred to the company. Societal and health integration of care is the process
by which the aged circle of consumers will be satisfied with the coming of the new product in the
market. NPD or new product development is being made possible for Tesco as the company is
steeped into being engaged in the process through the collection of valuable material as in
information on consumer preferences and tastes, market rivalry and the upgrade of technology
for capitalising on the new opportunity as it presented itself. The company can go for tie-ups
with start ups that support kale and vegan diets in order to show some seriousness in their
concerns for the health of their brand loyalists. This will also help in the enterprise considering
the concepts of frugality by catching the fancy of the health-conscious consumers who can team
up to be converted into Tesco loyalists through this.
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Table 1: Concept of innovation mapping (innovation-mapping template)
Source: (Baller et al., 2016)
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