TECHNOLOGY MANAGEMENT IN INFORMATION AGE
TESCO SELF CHECK OUT MACHINES
Table of Contents
Executive Summery 1.0 UK RETAIL I DUSTRY 1.1 TESCO 1.1a Tesco’s Competitors 1.1b SELF CHECK OUT MACHINES 2.0 CHA GE MA AGEME T 3.0 Types of Organizational Change 3.1a Incremental change 3.1b Transformational change 3.1c Strategic change 4.0 TRIGGERS OF CHA GE 4.1a Internal triggers 4.1b External triggers 5.0 PLA I G & MA AGI G CHA GE 5.1a Force Field Model 5.1b Continuous Change Process Model 5.1c Emergent Approach 5.1d Kotter’s Model 6.0 RESISTA CE TO CHA GE: 6.1 Causes of Resistance 6.1a Low Tolerance to change 6.1b Employee Resistance to change 6.1c The Shock of the new 7.0 ORGA ISATIO AL A AYSIS 7.1a Threat of new entrants 7.1b Power of Suppliers 7.1c Power of Buyers 7.1d Threat of Substitutes 7.1e Rivalry 7.2 SWOT Analysis 7.2a Strengths 7.2b Weaknesses 7.2c Opportunities 7.2d Threats 8.0 What Caused the Change in Tesco 8.1a Creation of Value for Customer 8.1b Growing customer base 8.1c Technological Innovation 8.1d Competition 8.1e Cost of Labour 8.2 Type of Change 1 2 2 2 3 4 4 5 5 5 5 5 6 6 6 7 7 7 8 8 8 9 9 9 10 10 11 11 11 12 12 12 12 12 13 13 13 13 13 14 14 23
8.2a The Process 9.0 Benefits of Self Check out in Tesco 9.1a Increase in Sales 9.1b Cost Effectiveness 9.1c Customer Satisfaction 10.0 Conclusion 11.0 Recommendation References Appendix
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The UK Retail Industry is the largest and most competitive industry. Tesco is an international retailer and the leading supermarket in the UK. It controls 31.6% of the UK’s market share. Its main rivals are ASDA, Sainsbury’s and Morrison’s.
In every organization there are macro and micro environmental factors that influence its decisions and operations. SWOT, PEST and Porters five forces are used to analyse the industry to gain competitive advantage. Tesco differentiated itself by introducing Self checkout in 2003 in its Dereham, Norfolk store. The success of the self checkout trial in Dereham store led to its implementation in other Tesco outlets. This work seeks to explore the self checkout system in Tesco and its impacts on the organization. A manager at a Tesco store in Essex was interviewed on the self checkout system to determine the reasons for the change, how it took place and the benefits to the organization. The manager purports that the self checkout has added value to the organization. It has enhanced the customer shopping experience by speeding up processes. The self checkout has helped to reduce queues at the checkouts and also boosted sales in the UK.
In the UK alone, 25% of Tesco transactions can be accounted for by the self checkout. Inspite of the few challenges facing the self checkout which include minors using the self checkout to purchase alcohol, the self checkout has been successful to the organization.
UK RETAIL I DUSTRY
The retail industry in the UK is the most competitive and fast growing one. By the end of 2008, 11% of all VAT registered businesses in the UK were retailers, with the total number currently at 180,875. UK retail sector generate almost 8% of the GDP, accounting for one-fifth of the UK economy. Retail industry employs 11% of the total UK workforce. Total combine sales of this sector in UK were £265 billion in 2007, larger than the combined economies of Denmark and Portugal.
Tesco is the UK’s largest retail chain and has outlet in every post code of the country with 2,115 stores and 280,000 staff. Internationally it is the third biggest chain in the world, employing 440,000 people in 4,000 stores across 14 countries.
Tesco operates its retail outlets business operation in six formats namely; Express (961 stores) Extra (177 stores), Metro (174 stores), Superstore (448 stores), Homeplus (10 stores) and OneShop (512 stores). Tesco.com is the online arm of the business operations to facilitate the...