STRATEGIC OPERATIONS ISSUES
Category : Organizational Strategic Plan, TESCO Case Studies
Table of Contents
Cover Page 2
Background of the Organization 4
Problem of the Organization 4
Background of the Problem 5
Analysis using Concepts 6
Appendix A: Figure showing Tesco’s Organizational Chart 10
Appendix B: Figure showing the process flow analysis illustrating that e-commerce is integrated into the organization 11
Master of Business Administration
Strategic Operations Issues
In order for an organization to operate and run smoothly and effectively, it must be able to employ and implement operational, project, and strategic management strategies that would enable it to function well in the business and in the industry. With such strategies, an organization would be able to resolve problems and conflicts that would create negative impacts on the operations of the organization. With this, the purpose of this paper is to provide discussion and application of the knowledge and concepts of strategic operations issues within organizations that would deliver strategic advantages and development in the organization. This paper also discusses the problem that a specific local organization encounters, which would provide knowledge in relation to the applications of the concepts, with the possible recommendations that would answer the problems or issues. With this, the impact of the problem and the use of the strategic operations concepts would be discussed and evaluated.
Background of the Organization
Tesco is the leading general merchandising retailer and international grocery in the United Kingdom, and manages over a thousand supermarkets, hypermarkets, and convenience stores in Ireland, Central Europe and Asia, and the United Kingdom. It originally specialized in food, but diversified in areas including clothes, consumer electronics, consumer financial services, discs and downloads, Internet service and telecommunications, and budget software (“”, 2007). Its core objective is to establish value for consumers to gain their lifetime loyalty. Its success depends on their valued consumers, who shop and work with the company. The company’s two core values include, No one tries harder for customers and Treat people as we like to be treated (“”, 2005). In addition, its mission and vision shows that the company focuses on providing quality service and at the same time values its customers by understanding and responding their needs, meeting their demands, maintaining and sustaining trained and motivated employees, continuously improving skills and service, and achieving excellence in all of the company’s endeavors (“”, 2006).
Problem of the Organization
However, despite the successful and achievable goals of Tesco, it still encounters a problem or issue of change that presents a huge impact on the operations of the company, which is the use of e-commerce. Although the company is considered the leading company in the dot-com business, Tesco still encounters problems in terms of differentiating its services from its competitors, which have the same level of technology with the company. It is considerably late in exploitation of the Internet, thus, allowing other Internet-based companies to have the edge over it. It has been reported that the Internet retailing arm of Tesco is not aware of its unsatisfied consumers, with waiting more than 10 seconds for downloading web pages, thus, leading them not to push through with their purchase (, 2000). This leads to the problem that the company has few reference points from which it could realize the response times consumers are experiencing as they access its web servers from different locations around the United Kingdom (, 2000). Thereby, this situation gives the chance for the company’s competitors to take advantage of the situation. This becomes relevant to the topics covered because currently, e-commerce affects all aspects of the business of an organization, making it a crucial tool for the operations of any business firm.
Background of the Problem
The arrival of the broadband Internet means more consumers that would shop online, which suggests plenty of room in the market for Tesco and its competitors. However, with the fast turnover of Internet and communication technologies, it is just a matter of time before the company’s competitors could catch up, thus, pressuring Tesco to utilize the use of e-commerce more creatively and effectively. The fast and dynamic changes that take place in the development of technology become crucial in the operations of the company because the use of relevant technology would hasten the operations and improve the quality of service that the company offers its customers. In addition, the use of e-commerce enhances and widens the capacity and opportunity to extend brands, implement incentive plans to boost employee effectiveness, to move up the value chain, to reduce levels of redundancy, and to innovate for low costs. (Please refer to the Appendices for illustration.).
Analysis using Concepts
Addressing the problem at hand leads to tackling the issue of improving the quality of the services that Tesco delivers and offers to its customers. The use of e-commerce presents great advantages and benefits for the company, given the efficient and effective access of consumers in the website of the company. However, because the problem of Tesco relates to the inefficiency of its webpage, the quality of service that it offers is risked, thus, losing the trust and loyalty of some customers. With this, several concepts of strategic operations can be used to discuss and further understand the relevance of the e-commerce problem of Tesco. Primarily, the issue encompasses the concept of Total Quality Management, which centers on the quality of a product or service through member participation, and aim at long-term success through achieving customer satisfaction (“”, 2007). In this regard, this concept may refer to techniques or strategies that can be used to improve quality and to satisfy the customers by utilizing the talents of employees while providing a positive financial return to the shareholders (as cited in and , 1995). This concept becomes very useful in addressing the issue because Total Quality Management focuses on project management approaches, with a series of steps including, planning, organizing, scheduling, monitoring, and controlling. This concept, thus, allow the company to come up with strategies and techniques that would promote the improvement of the quality of their service. Although Tesco is considered the leading retailer in its industry, it can be perceived that it lacks the implementation of the Total Quality Management techniques, which would guide the company to focus on improvement and development of its service. Another concept that is useful in addressing the problem of Tesco is project planning, which underlies the importance of task allocation. Task allocation becomes important in this problem because it involves the participation of the different people in the team who would be responsible for developing the website of the company to improve the quality of its service. Task allocation, then, should be seen in this sense as a means of increasing the capabilities and experiences of the team in getting a project done (, 2007). With the use of this concept, the company would be able to not only focus on a specific project itself, but on the individuals or employees who will be assigned to do the tasks. Thus, project planning, being under the larger concept of project management, includes identifying project goals and objectives, detailing tasks and goal achievement, and specifying the time allotted, budget, and resources to be used for the project (“”, 2007). With this concept, Tesco will be able to effectively and efficiently accomplish their projects on the given time they have allotted for completion. It would also serve as a guide for the company on realizing its flaws in terms of project implementation, including their use of e-commerce. In relation to this concept is the emphasis on another operational issue, which involves resource constraints, such as the inability of the members of the Internet retailing arm of the company to determine the inefficiency of their system. Aside from the ineffectiveness of the Internet system of Tesco, the employees assigned to improve its operation are ineffective as well. In this regard, the concept that would largely influence and affect operational management is Human Resource Management. The lack of effective and efficient employees of Tesco may contribute to the problems it faces. Thereby, the improvement of the management of the company’s Human Resource would lead to the improvement of its operations. The improvement of this aspect of the company supersedes the problems in project planning, management, control, process management, and operations strategy and improvement.
Suggestions to improve the efficiency of operations of the company include giving additional seminars and trainings to the personnel, creating safety measures, strengthening processes, learning new techniques, keeping the working environment safe, solving problems among employees, and finding useful means to counter financial problems. To improve the operations of Tesco, the company can provide trainings and seminars that would further widen the knowledge of employees, thus, giving them sufficient information useful for improving the operations of the company. The personnel have the main function in business operations and would be the ones achieving the company’s long-term goals. This also involves solving their problems that would lessen dissension and conflicts. Safety measures should also be created to prevent worries on the part of the employees in performing business operations. Fear hampers efficiency, thus, crippling and slowing their productivity. Strengthening the operations process could also be helpful, to achieve lesser mistakes and minimize operational costs. Another helpful recommendation is finding useful means to counter financial problems, such as building good relationships with shareholders and suppliers, revolutionizing its supply chain management, lessening costs, and guaranteeing the availability of products (, 2004), which would contribute to the improvement of the quality of service of Tesco. An action plan that can be implemented is learning new technological process or system, which can be done through attending seminars and symposia, such as seminars given by software and IT companies that would inform Tesco of the recent developments in terms of software applications. It can upgrade and modify a significant portion of its internal software to guarantee that its computer systems will function properly (., 1998), thus, promoting innovation, that involves installation and use of new information systems and software programs. This would enable the company to encourage internal and external communication development more effectively. With this, the quality of service will be improved, the output of the company will increase, and is considered a cost effective plan because it focuses on the long-term goal of the company, which is to satisfy and retain its customers through effective and efficient customer service.
Appendix A. Figure showing Tesco’s Organizational Chart
(From “”, 2005)
Appendix B. Figure showing the process flow analysis illustrating that e-commerce is integrated into the organization