Tesco’s strategic analyses
This report will show an insight into Tesco’s supermarket company, identifying the need for strategic change and the importance of their external environment and resource analysis. The competence, culture, management and corporate leadership will be addressed.
The supermarket giant is the leading grocery market in the UK (with a market share of around 30%) in 2010 and announced a profit of £3.4bn. They also provide online services through their site Tesco.com. 50% of sales is from the companies brand which is at three levels from the lowest value to normal and the highest finest.
Organisations are changing; everything about the organisation is to serve the customers and satisfy their needs. The arrival of Tesco and other major international supermarkets means that retail pattern are changing in the developing world. According to Nolan (2006) “we live in a changing world and the rate of change is accelerating, how we live with change is the most important single challenge of our lives”. Tesco is expanding globally and will need to grow with the changes in today’s society which is moving on a fast pace and also expecting to sustain competitive advantages in the marketplace.
People resist change even when it is actually in their best interest to change, but change can be introduced gradually for people to understand the need and importance and avoid stress and shock. Future shock is defined as the stress and disorientation suffered by people when they are subjected to excessive change. Warren Bennis argue that the pace of change makes old bureaucratic structure unable to cope with change.
Tesco can also put into use Kurt Lewin’s three step model of change (Unfreeze, change and refreeze). These three steps gives managers an idea of implementing change when dealing with people but the change will only be effective when it is acknowledged and put into practice.
Unfreeze – put in liquid form read to change (defrost)
Kurt Lewin state that it is difficult to embrace change in a structured organisation because people have developed their own habit and routine within the organisation. This mean they are in their comfort zone where they do things their own way using the same method without questioning their ability to carry out different task. People must cut out the bad habit, understanding the need to change and the benefit that will be gain and implement new ways to reach their objectives.
Change – implementation
When the team members have fully understood the reasons for change, they need a transition period to fully digest the new information and recognise the new tasks and responsibilities. It will be difficult to get use to these routines but with time change can be achieve.
Refreeze (put back in solid form)
Putting the Organisation into an effective structure and make change permanent and encouraged employees to maintain the standard. Lewin believe that further changes can be made later when the need arise but putting the organisation in a solid form will help the people to become familiar to the changes and improve the conduct of its operation.
Tesco supermarket being the third largest food retailer in the world has reached a high level with the top players in the business field. Coulter M (2008) states the three factors critical to success in the new business environment, “first is the ability to embrace change, secondly creativity and innovation capacities and being a world class organisation. Tesco has achieve these factors but they can be improved, therefore what new changes will they introduce to sustain their position and becoming the world’s no 1 food retailer beating Carrefour and Wal-Mart? Coulter further states that change is the only word that captures the essence of the new business environment, change arising from technological advances, change from resource vulnerability or changes from information availability.
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