Wednesday, May 6, 2020
Strategic Management for Engineers
Question: Discuss about the Strategic Management for Engineers. Answer: Introduction: The main objective of Tesco is to expand its operation and store in international market. In 1990s, Tesco was UKs second largest food retailers. However, in 2013, Tesco was ranked as the largest UK food retailer. The growth in the company was due to the strategies formulated by the CEO, Terry Leahty that repositioned Tesco from the discounted roots to mass-market customer focused retailer serving all the segments in UK market (Mei? 2016). The first change in the strategy was introduction of Tesco Club card, which was UKs first customer loyalty card that included the information of the customers and provided the customers with additional benefit. Another strategy used by Tesco was development of new store format that served the oval shoppers and made the shopping easy. According to Alexandrino (2014), Tesco was facing regulator pressure due to rise in the competition. However, the strategy adopted by the company focused on long-term growth with its concentration on operations and capital investment. The strategies of Tesco also focused on diversifying its product portfolio to the non food sector and retail services with the focus on online shopping channel and non food products. In 1997, the strategy of Tesco also focused on expanding its busines1990 where the s outside home market via international diversification. The first phase of strategy was launched in 1990s where the company was successful in expanding its organization in Europe. The next phase of strategies was launched in 1998 where the focus of strategy is one expanding its operations to Asian market entering Thailand and South Korea (Kim and Hallsworth 2015). The strategy of Tesco focused on the liberalization of retail foreign direct investment during the expansion of business in Asian market. The liberalization of investment helped the company emerge as the market leader in retail business offering products at discounted prices (Dawson and Mukoyama 2013). The next phase of Tescos strategy focused on expansion of the stores in China and India. In just twelve years, the company has one thousand seven hundred and nineteen stores all over the world. The strategy of the company that focused on expansion of the store in South Korea in the year 2012 proved to be successful. South Korea gave Tesco the second largest platform after UK for emerging as the market leader in retail sector. With the change in the CEO of Tesco the strategies used by Tesco was also changing. In 2007, Tesco made one of the most risky moves of expanding its business to United States of America. The strategy that was adopted by Tesco to enter the market of USA was small format retail skills to attain competitive advantage. The company had confidence of expanding in the international market due to its effective management of small format stores. The strategies of Tesco are also on development of cool chain distribution and logistics systems required to manage its products (Ghrmay 2016). The high quality food and affordable fresh and chilled prepared meals were sold under the brand name of Tesco. The store of Tesco in California was opened under its own brand name that is fresh and Easy where the products of Tesco were sold under its own brand name. Hence, strategies of Tesco focused on attainment of long-term goals with the focus on capital investments, operations and international expansion. Strategic Directions Tesco has faced many challenges threatening the market performance of retailer. Hence, to overcome such challenges it is essential for the company to develop efficient strategies with a strategic direction. Though Tesco has been successful in expanding its operations, in various parts of the world the major part of the sales and profit comes from the UK store. Sixty six percent of the sales and profits are still generated from the stores of UK (Lowe et al. 2012). Hence, it is essential for the company to develop strategies that focuses on globalization and expansion. In addition, the company should ensure that the stores in the international market are operating well so that they are able to contribute towards the market performance positively. The major drawback of Tesco strategies was entry of the retail business into the USA market (Foster and Noh 2013). One of the best things about the strategy of Leahy was its ability to transform a change under the market support of hostile pub lic scrutiny and retainment of financial market support for the strategy. This strategy was never possible with the entry of the business in the USA market. Tescos market entry into the USA market was apprehensive in either the sense that the entry could be transformational or a failure. It is essential for the company to not just rely on sales from the UK store but also plan on expanding its business to the international front. The company should expand its business in those parts of the world that is well established and where the competition is low. Having fewer competitors makes it easy for the company to establish its business and attract larger customers that are loyal. Tesco has a large customer base that is one of the advantages of the company (Haddock-Millar and Rigby 2015). The strategies of Tesco should be more flexible in order to produce more flexible goods and services in order to avoid massive fluctuations in the environmental changes. The strategies should also focus on evaluation of the risks. It is not just essential to formulate efficient strategies. It is also essential to evaluate and monitor the strategies and the performance of the organizations that is set in the various parts of the world. Time is another factor that affects the growth of the company. It is essential for the organization to formulate such strategies that focuses on immediate projects. The organization should focus in two strategies that are market development and product development. Hence, before setting strategies the organization should focus on the future goals and then formulate the strategies accordingly. References Alexandrino, J., 2014.Tesco PLC: Equity research(Doctoral dissertation, NSBE-UNL). Dawson, J. and Mukoyama, M., 2013. 1 Recent developments in retail internationalization.Global Strategies in Retailing: Asian and European Experiences, p.5. Foster, M.J. and Noh, T.J., 2013. Tesco strikes out into Asia.Frontiers of Business Research in China,7(2), pp.289-310. Ghrmay, T.M., 2016. Tesco: Losing Ground in the Uk.Available at SSRN. Haddock-Millar, J. and Rigby, C., 2015. Business Strategy and the Environment: Tesco PlcS Declining Financial Performance and Underlying Issues.Review of Business Finance Studies,6(3), pp.91-103. Kim, W. and Hallsworth, A.G., 2015. Tesco in Korea: regulation and retail change.Tijdschrift voor economische en sociale geografie. Lowe, M., George, G. and Alexy, O., 2012. Organizational identity and capability development in internationalization: transference, splicing and enhanced imitation in Tescos US market entry.Journal of Economic Geography, p.lbs016. Mei?, I., 2016. internationalization of retailing.Business Logistics in Modern Management.