Strategic Analysis of Tesco Plc

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1. Executive Summery 1

2.0Organizational Overview 2

2.1VMOST 3

3.0Evaluation of the External Business Environment 5

3.1PEST Analysis 53.2Porter’s Five (5) Forces 63.3Industry Life Cycle 7
3.4 Key Success Factors83.5Competitor Analysis 113.6Degree of Turbulence 133.7Opportunities & Threats14

4.0Evaluation of the Internal Business Environment16

4.1Resource Audit 164.2Value chain Analysis 174.3Mc Kinsey 7-S Model 214.4GE Matrix234.5VRIO Framework254.6Core Competencies & Distinctive Capabilities264.7Critical Success Factors 274.8Financial Analysis284.9Strengths & Weakness304.10EVR Congruence314.12Strategic Fit33

5.0Strategic Direction16

5.1Strategic Direction16

5.2Strategic Option16

5.3Strategic choice16




5.7Rejected Options.16

5.8Strategy objectives16


6.1Implementation plan16

6.2 Resource Allocation and budgeting


List of Figures

Figure 1: PEST 6

Figure 2: Porters Five Forces 8

Figure 3: Industry Life Cycle 11

Figure 4: Competitor Positioning 14

Figure 5: Degree Of Turbulence 15

Figure 6: Value Chain 19

Figure 7: Mc Kinsey 7-S 22

Figure 8: GE Matrix26

Figure 9: EVR Congruence 35

Figure 10: Porter’s Generic Strategies37

Figure 11: Ansoff Matrix37

Figure 12: Basic implementation process37

List of Tables

Table 1: VMOST 4-5

Table 2: PEST Analysis7

Table 3: Porter’s Five forces of Competition 9-10

Table 4: Ohmea 3C’s 12

Table 5: Competitor Analysis13

Table 6: Resource Audit16-17

Table 7: Value Chain19-21

Table 8: Mc Kinsey’s 7S Framework22-24

Table 9: GE Matrix Analysis 26

Table 10: VRIO Framework28

Table 11: Core Competencies & Distinctive Capabilities29

Table 12: Critical Success Factors30

Table 13: SWOT32-33

Table 14: EVR Congruence34

Table 15: Strategic Fit36

Table 15: Budget52

Executive Summary

This report done by the Author covers the Strategic analysis of TESCO PLC, it gives a detailed reflection of the current business environment that TESCO currently operates within. The author begin with an analysis of the external environment employing the use of various models covering a wide range of areas such as: Political and economic issues, key success factors , analysis of competitors, the degree of turbulence in the industry to name a few.

Next is the internal analysis of the organization itself will be looked at some examples of what will be analyzed; resources, financial and non financial, Critical success factors, Core competencies, distinctive capabilities. The authors will then determine the congruent state of the organization, matching its values, and resources with the environment.

Finally 3 strategic options will be given, based on the previous analysis which will guide the strategic direction; only one option will be selected and evaluated along with implementation plan and budget.

1. Organizational Overview

Founded in 1924, Tesco is the largest and most profitable supermarket chain in Great Britain, which sells food and non-food items. Currently it controls over 30% of the grocery market in the UK. In 2011, the supermarket chain announced over £2.55 billion in profit. ( 2012).

The company possesses approximately 2979 stores, throughout United-Kingdom, which include: Extras stores, Superstores, Metro stores, Express stores and homeplus stores which together employ 500,000 persons. Tesco is the largest UK retailer by market share and sales and the third largest retailer in the world. Its main UK competitors are Asda and...
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