Tesco
Executive Summary
Starting from a small stall in the east end of London, Tesco today is the largest retailer in the UK with over £59 billion sales in 2008. In this dynamic environment, Tesco has managed to stay ahead of its competition through focus on people, both customers and employees. However, in today’s rapidly changing globalised environment, anything could happen. Companies today need to always innovate and reinvent themselves in order to maintain their competitive advantage. The macro environment that Tesco operates in provides both opportunities and threats. Therefore, for sustainable growth and development, Tesco needs to have proper strategic direction that addresses these macro environmental challenges.
Though the company has extensive operations worldwide, Tesco’s largest market is still the UK. This report analyses the macro environment that Tesco UK operates in using the PESTEL framework and its interconnectedness to external opportunities and threats. Competitiveness of Tesco UK is analyzed by applying Michael Porter’s five forces model. The paper is further expanded by linking both the PESTEL framework and the 5 forces to understand Tesco’s dynamic macro environment. A stakeholder analysis is carried out in order to understand the expectation of Tesco’s stakeholders. Strategic capabilities of Tesco are explained through the identification of core competencies of the firm. Justification of these competencies explains how Tesco manages to stay ahead of its competitors.
Table of Contents
1. Introduction to Tesco Plc 6
1.1. Tesco UK 7
2. The Macro Environment Analysis 8
2.1 Political Factors 8
2.2 Economical Factors 8
2.3 Social/Cultural Factors 8
2.4 Technological Factors 8
2.5 Environmental Factors 8
2.6 Legislative Factor 8
2.7 Overall impact of the PESTEL factors 8
2.8 Potential opportunities from the external environment 8
2.9 Threats from the external environment 8
3. Competitive Analysis on Tesco
Starting from a small stall in the east end of London, Tesco today is the largest retailer in the UK with over £59 billion sales in 2008. In this dynamic environment, Tesco has managed to stay ahead of its competition through focus on people, both customers and employees. However, in today’s rapidly changing globalised environment, anything could happen. Companies today need to always innovate and reinvent themselves in order to maintain their competitive advantage. The macro environment that Tesco operates in provides both opportunities and threats. Therefore, for sustainable growth and development, Tesco needs to have proper strategic direction that addresses these macro environmental challenges.
Though the company has extensive operations worldwide, Tesco’s largest market is still the UK. This report analyses the macro environment that Tesco UK operates in using the PESTEL framework and its interconnectedness to external opportunities and threats. Competitiveness of Tesco UK is analyzed by applying Michael Porter’s five forces model. The paper is further expanded by linking both the PESTEL framework and the 5 forces to understand Tesco’s dynamic macro environment. A stakeholder analysis is carried out in order to understand the expectation of Tesco’s stakeholders. Strategic capabilities of Tesco are explained through the identification of core competencies of the firm. Justification of these competencies explains how Tesco manages to stay ahead of its competitors.
Table of Contents
1. Introduction to Tesco Plc 6
1.1. Tesco UK 7
2. The Macro Environment Analysis 8
2.1 Political Factors 8
2.2 Economical Factors 8
2.3 Social/Cultural Factors 8
2.4 Technological Factors 8
2.5 Environmental Factors 8
2.6 Legislative Factor 8
2.7 Overall impact of the PESTEL factors 8
2.8 Potential opportunities from the external environment 8
2.9 Threats from the external environment 8
3. Competitive Analysis on Tesco