Operations Management of Tesco: Case Study Analysis

(Illustration 1: TESCO Plc., 2021)

Case Study

Tesco is a brand which has been and still is part of varied or numerous markets around the globe and that of most biggest and strongest one. The company have gone through huge cut-throat competition in past years with highly saturating market. The approach used by Tesco to survive is of expansion where the entity have moved to places by using its store business model in order to make its presence in countries like China, Turkey, Poland etc. The reason behind Tesco's growth and development and which made it a large organisation with leading structure is its expansion and movement into number of places in the world and its excellent corporate strategy.

(Illustration 2: Tesco Ranked Top Supermarket for Food Waste Prevention, 2018)

Presntly, Tesco operates in 12 potential markets of the world and wishes to continuously expand and grow, as well as diversify too in order to be competitive enough. Tesco follows a customer centric approach in order to support its functional and business strategy where it breaks its myriad traditional rules of retailing. Tesco always plays in a manner to stay ahead of the competitors. The key aspects of customer centric approach that creates problem for the brand is of its policy to keep the prices low by suing cost cutting strategies and making purchases from developing economies like India and China.

(Illustration 3: CHINA: Tesco, China Resource Enterprise in JV talks, 2013)

The problem arises in maintaining the low price policy, as it is a successive strategy but it does not carter for all the segments of the market. Some customers in certain segments take the low price strategy as economic strata and assumes to the low prices of the products to be compromise in quality.

In regards to the problem and win back their customers, their trust over the brand and their offerings Tesco introduced Loyalty cards. The image below shows the clubcard of Tesco which was introduced as a CRM Campaign by the company and also focusing on agenda to regain trust of its customers and become more and more competitive.

(Illustration 4: The Psychology of Shopping: the Tesco Clubcard, 2013)

The use of club cards made the objective of Tesco to fulfil, while completing the process of clubcard company also conducted research and collected several personal details and information of people. But another problem that encountered by Tesco was of losing potential customers again. This is due to the fear of people for technology and their insecurity in regards to their personal information being misused and leaked. The data was important for Tesco and enabled it in earning more focused approaches to conduct marketing actions and be more productive. The company could have adopted another way of competing their research. Tesco could have been conducted survey to gain knowledge about customers and seek more information. The process would have been a supportive tool for Tesco to innovate and come up with new ideas to maintain their customer loyalty and offer them best valued services and products.

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Improvement Measures and Recommendation

Tesco and its management are keenly inclined towards company's growth and development. Thus, the recognised problems and their suggestive measure are managed by company by using certain managerial approaches and making improvement in operations of Tesco. The first approach which is strong and productive enough for Tesco in case of managing its operations and making improvements is of using Continuous Improvement Approach (CIA). This process is all about and revolves around improvement and improvisation made in products, services and operations of Tesco on an ongoing basis.