Report on Tesco's Organisational Structure & International Expansion

This report provides a comprehensive analysis of Tesco's organizational structure and its impact on international expansion. It examines various organizational structures, including hierarchical and flat structures, and identifies the structure adopted by Tesco. The report delves into the drivers of globalization, such as technological advancements, government policies, market demands, and cost considerations, and assesses their influence on Tesco's international operations. Furthermore, it includes a PESTLE analysis to evaluate external environmental factors and a SWOT analysis to determine strengths, weaknesses, opportunities, and threats. The report also highlights the impact of digital technologies on Tesco's international expansion strategy, emphasizing the role of communication and data transfer. The conclusion underscores the significance of organizational structure in maintaining overall functioning in global markets and emphasizes the importance of adapting to environmental factors for successful international operations.

Organisational Structure and
International/Global Expansion
STUDENT NUMBER -

Table of contents
• Introduction
• TESCO that has expanded into international markets,
• Types of organisational structures
• Organisational structure of TESCO
• Influences/factors that have affected international expansion of
• PESTLE Analysis of TESCO
• SWOT Analysis of TESCO organisation:
• Impact of digital technology on the international business
• Conclusion
• References

Introduction
Organizational structure refers to organizational planning that includes branches, departments and activities in
which organizational activities take place (Henry, 2021). The global change with international trade is a
growth process that is supported by a strong organizational framework. This presentation will provide an
overview of the organizational structure and functions of TESCO. In addition, the report will address the
company's various needs to assess market conditions for its growth in the international market. Finally, this
report will highlight the effects of digital technology on business growth activities.

1) TESCO that has expanded into international markets
TESCO is a grocery store and retail organization based in Welwyn garden, London, founded in 1919. The effective
management and strategies of company assisted its growth and expansion globally (Tesco, 2021 ). This retail brand
deals in selling of mainly food products and operates in eleven countries with owing approximately 4600 stores
indicating its high market presence. This well established company is the third largest retail brand measured in
revenues.

Various activities across TESCO
There are several business functions at TESCO that are as follows:
• Financial function: TESCO's financial function covers a wide
range of functions such as organizing the organization's financial
policy, financial management, production costs, credit facility,
accounting, debts and salary management and customer payments.
• Marketing and sales: TESCO's marketing function has a major
responsibility to increase sales of the company's products (Bashan,
and Notea, 2018). There are other organizational marketing
activities, including export management, advertising, market
research, etc.
• Production Function: This activity is closely related to obtaining
production tools and services at low cost to maximize
organizational profits.

Types of Organizational Structure
In particular there are seven types of organizational structures that are as follows:
• Hierarchal organization structures: Contains a pyramid structure or a hierarchal structure in which the upper
person has higher authority and power which declines gradually as it descends.
• Functional organizational structures: This is similar to hierarchical structure but in this case with authority,
responsibility is at the same level and decreases gradually as it goes down.
• Horizontal organizational structure: It is the organizational structure with full organizational authority and
responsibility in which a senior manager manages all his subordinates.
• Divisional organizational structure: This type of organizational structure consists of the departments in
which they build their operating system in order to complete the task in consultation with other departments.
• Organizational structure of matrix form: This type of organization consists of collaborative relationships in
which all employees work effectively by working with each member.
• Team-based organizational structure: This type of organizational structure involves working in a group
where a few people with different skills are divided into one group to do the work.

Organizational Structure Chosen by Tesco
The TESCO organizational structure follows hierarchical structure in which the structure, position and
responsibility are divided properly ensuring constructive flow of operations. The hierarchical structure from top to
bottom, means that the higher person will have greater authority over his subordinates and have greater
responsibility on him.

Continue

Influences/factors that have affected international expansion of TESCO

Continue
The critical drivers of globalisation are identified below:
• Technological drivers: Rapid technological change is among the key issues in TESCO's global trade. The
development of ships, vast area network, cointaineering, low area network, cell phones, cellular network and
the Internet has facilitated international communication and led to a global trade process (Technology in
Tesco, 2016 ).
• Government / political drivers: As a result of international freedom policy the economies has witnessed less
challenges to global trade. The General Agreement on Taxes and Trade (GATT) established in 1947 and the
establishment of the World Trade Organization (WTO) in 1995 opened doors to companies in connection with
the united world trade.
• Market Drivers: Customer demand has grown significantly with availability of various products available
worldwide. This creates a need for markets to grow internationally and to opt for international trade.
• Cost drivers: The fact that product cost varies from place to place due to the availability of components
needed to produce the product. A major responsible feature of TESCO's international operations is the
availability of low-cost products to customers.

PESTLE
PORTERS 5 FORCES
SWOT/ VALUE CHAIN/VIRO

Evaluation of Models
• Pestle factors affects the external environment which is beyond the control of an organisation. The operations of
Tesco are likely to affect by impacts of Brexit which would cause trade restrictions for the company.
Economical factors directly affecting decision making of company through changes in employment wages act.
Social factors are favourable in context to Tesco as people are becoming more inclined towards high quality
fresh food products. In technological aspects, online marketing helps in enhancing customer base for the
company. In legal and environmental context the company ensures compliance with legal and environmental
standards.
• According to analysis of porter's five forces, the threats discovered in the model are very important to
determined for analysis of competitiveness in the market (Who are Tesco’s main Competitors, 2021 ). The
threats of new entrants is low as the it is not possible for a emerging business to compete with Tesco.