Tesco's Global Strategy: Ventures, Tactics, Environment & Problems

This report provides a comprehensive analysis of Tesco's global strategic management, including an evaluation of its ventures and corporate tactics, along with extrinsic and intrinsic environmental analysis. It delves into the techniques and tools applied by the company, their strategic planning processes, and various contemporary strategic problems, illustrated with examples. The analysis includes SWOT and PESTLE assessments, as well as Porter’s Five Forces model, to evaluate Tesco’s competitive positioning. Key strategic options like differentiation, leadership, and niche strategies are discussed, highlighting their impact on achieving sustainable competitive advantage. The report also addresses challenges such as quality issues, customer retention, and the impact of the COVID-19 pandemic, offering recommendations for improvement. This document is contributed by a student and available on Desklib, a platform offering study tools and resources.

Global Strategic
Management

INTRODUCTION
Global strategic management is undertaken as the practices which allow business for
capitalising upon the competitive chances on international base. Benefits of adopting global
strategy is that they earn new revenue potential, greater access to talent and learning a new
culture(Allison., 2017). This report is based upon the organisation TESCO, which is one of the
growing British worldwide groceries as well as general merchandise retailers and having
headquarters is in Welwyn Garden city, England. The topics which are going to be discussed in
this report are evaluation related to ventures and corporate tactics utilised through firm as well as
also regarding extrinsic & intrinsic environmental analysis. Moreover, the determination related
to techniques, tools applied by entity and also regarding their strategic planning, various
strategic problems of contemporary into tactics with assistance of illustrations. Apart from this,
some recommendations are also provided in this report.
MAIN BODY
There are several problems as well as difficulties tackle through TESCO like their
maximising liabilities as well as also undergone large monetary debt. Moreover, it also tackling
the problems in respect to lower quality of their goods and facilities as well as also related to
failures for understandings the difference of culture & trends within another nations. The key
present difficulties for respective firm is the COVID-19 circumstances in which entity have huge
impacts through particular circumstances and it has to tackle several forms of issues for being
competitive again within marketplace.
A)
TESCO company has used three main strategic options which is available for TESCO
company in order to achieve sustainable competitive advantage. They are mainly differentiation,
leadership and niche strategy. The main business strategy that has been used by the TESCO
company is to aggressively expand into overseas markets of grocery(Chatterjee., 2017).
Differentiation strategies are those which are helpful in terms of giving the way to compete
against other firms without getting into a price war. They have also made improvement in their
quality of products through which brand loyalty can be increased even at higher price.

They have given more focus towards democratic style of leadership where employees
voice have been heard during decision-making time and involve their point of views as well in
order to achieve a competitive level. TESCO has identified new niche market by focusing on
more limited customers and further develop edges by having the option to have higher put on
hold (Chigudu., 2020). They have launched separate venture brands that allowed company to up
to particular niche markets. The company has also launched a price matching scheme that gives
customers an assurance and confidence level as well. The positive contribution has also brought
through strong use of social media on different platforms like Facebook and You tube that
creates warmth and positive connections as well. The company has also made major focus
towards club card that provides a reward system in order to keep customers coming back on
faster pace manner. In the overall manner they need to focus on working on the nature of labor
and products so they can draw in huge number of clients and can hold them for longer
timeframe. They have to always bring some unique idea into the market so that they can give
something unique feature into the market as a result TESCO company can earn on higher basis.
In this way, company has used various strategies and planning so that they can bring positive
changes in an organisation.
B)
SWOT Analysis
STRENGTHS: TESCO has its greatest strength as far as biggest supermarket in Britain and
furthermore it is a proficient organization of providers. It has additionally its most elevated
portion of the overall industry and it likewise overwhelms the market through holding the
greatest market shares (TESCO SWOT analysis). They have also earned multiple awards as
British favourite super market and has also won the award of best grocer.
WEAKNESSES: According to the current issues faced by the company where they can't
understand the culture of another country into deeper manner due to which they have to face
certain issues or failure in the US and Japanese market(Cimon and Poulin). They have suddenly
changed the club card without informing to their customers due to which they have lost their
brand image into the market.

OPPORTUNITIES: TESCO has taken initiative towards expanding their business operations in
fourteen countries and has also launched a new discount store by the name of Jacks which has
performed into well mannered way.
THREATS: TESCO needs to confront public monetary emergency in wording public financial
elements like tariffs, government rules and guidelines are a genuine danger to the development
of TESCO organization (D Çinar, O., 2015). Due to BREXIT deal and supermarket competitors
they have to face challenges in terms of standing competitively into the market.
PESTLE Analysis
Political Factors: Company deals has brought down to a specific level because of BREXIT
condition and US China exchange battle because of which organization needs to confront battle
as far as keeping up with its situation into the market
Economic Factors: The organization ought to have sharp eye over the monetary changes that
happen in nations and furthermore should know about tax policies so they can use something
very similar for their own advantages. Any progressions in the strategies of UK nation will
impact the deals of organizations into a country.
Social Factors: Under this component, the selection of items additionally relies upon different
social variables where the individual has carried on with for their entire life. Moreover, TESCO
needs to evaluates the patterns in changing society and cultural impact as well (FOSSATTI and
et.al., 2020).The organization likewise has faith in helping the general public and furthermore
helped the general public that has produced work in different nations.
Technological Factors: The organization has to manage the pattern of online shopping as well
as upgraded application because of which clients can deal with their shopping on online basis in
these pandemic circumstances too.
Legal Factors: The modifications of government strategies straightforwardly influences the
business operations (TESCO PESTLE analysis).They need to obey the domestic and global
market rule to proceeds with their smooth activities. In this pandemic circumstance, they can't
follow judicial procedures as far as paying compensation similarly to all the staff individuals.
Environmental Factors: For attaining a sustainable community, organization has introduced its
period of eliminate, decrease, reuse and reuse plan so they can uphold the climate into positive
range.

With help of business structure, the difficult issues has been settled by effective decision
taking, new drives and utilization of innovation has extraordinarily helped as far as settling
issues of this pandemic circumstance. This sort of investigation has helped as far as examining
the provisos of the organization and furthermore gives thought as far as how to stand seriously
into the market.
C)
Porter’s five force model:
It is defined as a model which is used by companies in order to determine the level of
competition prevailing at marketplace (Gegg and Wells., 2017). In addition to this, it help
organisations to know about the threats associated and develop effective strategy for dealing with
it in an effective manner. The model includes five competitive forces and is given below in
context to Tesco:
Threat of new entrants: This threat is low for TESCO because of high capital requirement by
the new entrants. The company need not to worry about new competitors because they don't have
enough money and expertise to explore the supermarket industry into appropriate manner.
Threat of substitutes: The organization has offered a wide scope of items and furthermore sells
substitutes of greater part of its items (Gegg and Wells., 2017). Threat of substitutes are likely
irrelevant and also low into the market because they sell substitute products on large scale.
Bargaining power of buyers: Bargaining power of buyers into United Kingdom nation is lower
as they are not extremely coordinated and it suspect this may be in an ideal situation when they
changed to its rivals like Asda and Sainsburry's.
Bargaining power of suppliers: TESCO discuss in an exceptionally hard way with the
providers to build its net revenues. So bartering power is low from the setting of providers and it
has been seen that organization has been blamed for tormenting providers over value cuts.
Competitive rivalry: TESCO has enormous number of rivals in the UK market and their rivals
spend richly on showcasing and promoting procedures. The tension from rivals is extremely
serious and value wars dispatched by the organizations are influencing organization's net
revenues.
With help of porter's five forces model, the organization has upgraded its presentation by
distinguishing where the power depends in a business circumstance. It is likewise useful as far as

distinguishing its strengths focuses and furthermore about serious situation into the market.
Along these lines, firm’s performance can be maximised.
D)
CEO of TESCO company has developed, designed and created strategic planning for
TESCO company in a very strategic manner. In this process, first of all TESCO company has
identified its mission and analyse the situation in a very appropriate manner(Grant and Baden-
Fuller., 2018). After that objectives has been set in a clear format so that they can work towards
it in a proper planning and then direction has been set so that results can be achieved within a
time framework. After this step, a marketing strategy has been developed so that so that they can
build their brand image in a very strong manner and can attract customers on a large scale. In the
last step, planning has been done in order to evaluate the company in a result oriented manner. In
this last step, weak points and loop holes has been identified so that company can perform in a
more better manner.
At the point when organization is clear with regards to their central goal then it is simpler
to pursue it and a kind of roadmap can be prepared due to which its clear that where to work in a
more concentrated manner and where to work in a smart manner so that outcomes can be
accomplished inside a set timeframe. At the point when goals are clear then its more
straightforward to alter it with changing timeframe and can likewise be carried out into fruitful
manner (Marques., 2018). The advertising procedure assumes a vital part as far as accomplishing
goals as this is a procedures by that clients get to be aware of their significant items and
administrations into effective way. At the point when TESCO organization is clear with regards
to their arrangement then it is more straightforward for them to foster themselves and strategise
itself into result-situated way. Thusly, Mr David John Lewis has planned key strategic planning
for TESCO organization
E)
While formulating strategy, TESCO company has to face certain issues related to quality
of products and services, retaining the customers for longer period of time, pandemic situation
and financial debt as well(Mursidi.,2017). For settling these issues it is essential that organization
needs to figure their destinations as per changing timeframe. For settling the essential issues

there are various types of techniques which should be defined so that outcomes can be
accomplished inside a period structure. There are essentially three forms of tactics which
incorporates business, practical and corporate level procedure. Under business level procedure,
certain inward investigation systems can be used like worth chain examination, VRIO and outer
structure like PESTLE and Porter’s five forces model. This sort of procedure level targets
acquiring upper hand. Under practical level technique, it is pointed toward working on the
adequacy of organization's practices into departments. The aim of this strategy is to align it into
appropriate manner with greater business strategy. Within corporate level methodology, it is
about choice of an ideal arrangement of business and decide how they ought to be coordinated
into a corporate entire for example portfolio.
It has been observed that strategies formulated by the company can't be implemented into
effective manner because they are not smart enough to understand culture of different countries
and also not proactive in terms of technically innovate themselves (Nazemi and et.al., 2015). At
different levels of strategy they have to face challenges in terms of implementing it into realistic
manner. At functional, business and corporate level strategies should be formulated ins such a
manner so that they can give effective results to the company in terms of performance. The
particular problems can be settled through blue ocean technique in which fundamentally it is the
real-time search for minimal expense and separation to open up another market space as well as
furthermore drive towards another interest too. The objective of blue ocean strategy is that entity
need to find and foster Blue Ocean so that it may investigate themselves into new market and
grow their share of market into suitable way.
It has been seen through a model that ZARA is an organization which has involved blue
sea system to extend their share of market. This is a brand which decoded the mantra of fast
fashion apparel industry with support of its strong supply chain management. At the point when
ZARA has full command over its production network then, at that point, brand can make new
plans and put them into stores. At the point when brand can give new plans to the market then it
is more straightforward to draw in clients for enormous scope and can hold those clients for
longer timeframe.

The negative point is that to grow its market they assume full responsibility for the
production network because of which there is no adaptability as far as executing the work. To
adequately execute the blue sea technique ZARA needs to repurpose the passionate utilitarian
direction of administration and furthermore deal with individuals industry also (Peleckis., 2015).
They look across to the complementary products and services offerings. They have also redefine
the group of buyers industry. It also redefines the consumer segments as well. So ZARA
company has to take lot of efforts in order to stand differently into the market.
What suggestions or recommendations would you make for TESCO in order to sustain its
position?
TESCO organization needs to work on themselves to support into the market for longer
timeframe. They need to significantly zero in on nature of items and administrations that has
been presented by the organization to its clients. To accomplish more significant level of food as
far as quality they need to make legitimate preparation and system for checking the nature of
items presented by the company (Peleckis., 2015). They need to significantly zero in on
mechanical upgrades and need to deal with most recent innovations so they can draw in huge
number of clients. They need to involve alluring elements in their site so clients can't change
themselves to another choice. They need to utilize refreshed applications so they can stand out of
enormous number of individuals towards utilization of refreshed and new applications. At the
point when clients significantly center around web based shopping then its simpler for persuade
them for their new items and administrations and appealing elements also. They have to work on
their market strategies as well so that their brand image can be build into stronger manner. They
can use various kinds of social media platforms in order to publicise their brand on large scale so
that every kind of age group people can take interest in terms of shopping on online basis.
In this pandemic situation, when mostly offline stores have shut down then they major
focus on online stores. So they have to come up with innovative ideas so that they can retain
them for longer period of time. They have to formulate their policies with a fresh page so that
customers can understand their main story and mission into innovative manner. It has been
suggested that they have to work on their investment parameter and sponsors as well so that they
can attract overseas customers on large scale. When there are large number of investors take
interest in the company the customers automatically attract towards them for purpose of

shopping into innovative manner(Todorov and Akbar., 2018).It has been recommended that
company has to come up with their unique story into the market so that customers can connect
with it into innovative manner and can trust the company for longer period of time from
customers point of view.
CONCLUSION
The above expressed report concluded that global strategic management plays a vital part
structure setting of business. It has been reasoned that there are sure issues which are looked by
the organization to accomplish upper hand into this worldwide market. It not really settled that
there are sure systems which will be useful as far as bringing choices into from the setting of
development and advancement of an association. There are sure instruments and strategies which
will be useful as far as improving execution of an association. There are sure strides to plan a
successful key preparation of an association. There are sure contemporary key issues as far as
forming system into inventive way and must be settled sure speculations, structures and
methodologies also. For improving the performance of company, there are certain
recommendations and suggestions which are required in order to enhance performance of an
organisation into positive manner.

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Online
TESCO SWOT analysis,2021[Online]Available through:<https://www.marketingtutor.net/tesco-
swot-analysis/>

TESCO PESTLE analysis,2021[Online]Available through:<https://www.mbaskool.com/pestle-
analysis/companies/18023-tesco.html/>