D1 Evaluate the appropriateness of business information used to make strategic decisions

Every organisations use communication to pass information between their different departments aiming to create a strategic plan. The strategic plan is an idea which aims is to achieve something that the organisation wants such as more customers. Strategic idea is set from different steps which are leading to success, of course only if the plan is well working. At least the strategic plan to be effective, each department of certain organisation has to play their role in an appropriate way. On this assignment I am going to look at strategic plans of Tesco. Companies, like Tesco, that enjoy long-term success, are focused businesses. They have a core vision that remains constant while the business strategies and practices continuously adapt to a changing world. In an increasingly competitive global environment, without a clear vision a business will lack direction and may not survive. Tesco has a seven part business strategy to help it achieve its vision.

A strategy is a plan which sets out how a business deploys its resources to achieve its goals. The company’s values set the tone for the decision-making process. In May 2011, Tesco committed £1 billion capital and revenue investment to improve the shopping trip for customers.

The first step in strategic plan creation is to identify the current situation of Tesco by carrying SWOT analysis. SWOT analysis is analyse carried from e.g. Tesco to identify the strength, weaknesses, opportunities and trends on their business. Tesco has property strength which means a valuable freehold-property portfolio and store land bank, both in the UK and overseas. In the UK Tesco owns many stores and this is why Tesco bites all the competitors. Tesco may look like a supermarket group, but when Britain's biggest retailer said last week that it is sitting on property assets worth £28bn, it outed itself as Europe's biggest property company. Also this helps them to expand in the UK which will give them strong financial base and that will help Tesco to open their branches in new courtiers (the last bit of the paragraph belongs to opportunities.) The CEO’s of Tesco can use that information and decide what could be improved by contacting Research & Development department. R&D could create a plan of improvements such as add car wash facility onto TESCO EXPRESS. This will be helpful to Tesco because R&D can find the best petrol value vans that Tesco can use to achieve their goal of expanding their delivery facility.

However Tesco’s big weakness is that neglected Chief executive Philip Clarke inherited “long standing issues” in the UK that had built up during his predecessor Leahy’s time. UK profits were, in effect, milked to finance the overseas expansion, leaving the quality of the shops, the staff service and the ranges lagging behind the competition. That has to be definitely improved and never to happen again because it will affect Tesco’s economy and could lead to bankrupt. In relation to the above information Human resources department has to manage different training programmes for the CEOs either as they also need to improve their skills in relation to better plan creation. This action taken by H&R will definitely help Tesco in relation to put strong base on the top of Tesco, which means if the CEOs are well introduced how to lead Tesco in better way then Tesco will definitely succeed.

Tesco’s current opportunity is that they have set aside £1bilion to invest in ‘Building a Better Tesco’ in the UK, Tesco is making the most of its existing stores, rather than adding new space, and is refreshing its stores with a warmer ambience, putting ‘Food first’, and increasing staffing levels to help customers. This is why Tesco has as I mentioned above, lots of properties all around the UK, so it is better way to improve the existing one than to spend lots more capital into new branches. In relation to above information Tesco has to use internal information of few departments. Research and Development will create a plan of improvements to existing stores in Tesco and in relation to increasing staff Tesco will use their H&R department to help them to add new employees but also that to not affect their current standard by employing new non experienced people. This is why H&R department can ensure some training for the new staff that will help improve their customer skills. There is always good to add some improvements to the business, this is why by creating new section in their existing stores Tesco will win the attention of many customers. The main treats of Tesco is that UK competitors in retail sector are competitive and while Tesco tries to re-position and catch up with what its rivals are doing in fresh food, Sainsbury’s, Asda and Morrison’s are expanding and investing in their own businesses. Tesco has to try to provide better services and add new services offering fresh food and healthy drinks which will get the customer’s attention and focused in Tesco. E.g. Tesco can add to their stores a section in where it’s shown how operatives extracting orange juice from fruits and put it in a bottles then sale it. When the customer see the process of juice making and also lack of any chemicals they will definitely prefer that rather boxed juice. To do that Tesco will get information from their purchasing department which will provide the materials, components and equipment required. An essential part of this responsibility is to ensure that stocks arrive on time and are of good quality including fresh and healthy products as I mentioned above. To achieve the good quality of fresh food and healthy drinks Tesco will contact production and planning department which will be responsible for setting-up the standards and targets at each stage of the production process. The quantity and quality of products coming off a production line will be closely monitored. These two departments will pass the created plan by each one of them which means that the strategic plan that they will made will be linked and help Tesco to achieve good quality of products, fresh and healthy food in their stores. The information provided by those departments will help Tesco to succeed in their creation of something new.

By looking at this swot analysis we can find that Tesco’s aim is to expand much more with improvements and new services rather than expanding new branches in the UK. Tesco used swot analysis and created a plan of the eventual improvements that will be made in relation to extend Tesco’s business. I did swot analysis and then created a plan for improvements also discussed who will help to the plan achievements and how that will happen.

Author: Kristiyan Karadzhinov