LEADING THROUGH DIGITAL DISRUPTION- TESCO
Executive Summary
Digital transformation of a business can mean implementation of digital elements in business processes and modifying their manufacturing processes to increase efficiency and productivity. Along with this, this transformation might also entail modification in their organizational processes, in business processes of the company or change in domain of their company. Tesco needs to become adaptable to suit the present situation and meet with the demands and requirements of consumers aligning with the interests of the market. Leaders need to engage various techniques and strategies to ensure a proper and efficient transformation process of the organization without hassles. Employing and engaging dynamic and skilled professionals is also crucial for Tesco.
Introduction
Digital transformation of a company has become synonymous with business development and expansion of a company in recent years. A company takes on these digital changes to incorporate into its operations for increasing value of their company and making it consumer friendly. Digital transformation of a business can mean implementation of digital elements in business processes and modifying their manufacturing processes to increase efficiency and productivity. Along with this, this transformation might also entail modification in their organizational processes, in business processes of the company or change in domain of their company. These changes also bring with them several challenges and risks during the transformation process, which can cause disruption in business processes. This report will study these challenges faced by a company during their transformation process, and critically evaluate these challenges in the organizational context. This study will also analyze various techniques and strategies that this preferred organization can implement to ensure an efficient digital transformation process and select processes best suited in a particular organizational context. For this report, the company that has been selected is Tesco
Tesco is a supermarket chain based in UK. It is one of the largest supermarket chains and employs over 4.2 hundred thousand employees across its stores spanning UK. The company has generated 6,476 crores GBP in the financial year of 2020 and has a market share of 27.4% in 2021 in supermarket sector (Vial, 2019). The company has committed to transform their business processes and introduce their products and services in digital media. The company adopted a digital process and opened to online stores in order to attract customers into company along with expanding and increasing their value and profitability. These fundamental changes also require efficient implementation and adept leadership to monitor their continuous growth of the company. In past years, Tesco has faced many technical glitches and technology failures which has negatively impacted their brand image and dissuaded customers from investing in the business. The company has attempted to adopt various online stores through introduction of apps and websites, which has attracted more customers into their business. They have also introduced several technologies to help in providing a seamless customer experience. Change in processes has also provided Tesco with an improved and efficient supply chain process (Sravani and Rao, 2017).
The company faces many threats in UK market as competitive market has grown. Along with this, Tesco has also been accused of poor customer service and low-quality goods in high priced products. These issues have resulted in loss of customer’s trust which decreases value of company in market. According to Ismail (2017), the company has also suffered debts in market and has been generating low dividends in its revenues.
They have a customer-oriented business process and have included this into their objectives to provide a better experience to their customers along with building a collaborative and efficient organization within company. The company gives preference to its values and ethics and follows a high principled business and fair trading process which makes company stand apart from the rest. Leading through a digital transformation process has posed many challenges and risks for company and required company to obtain strategic planning techniques to withstand these forces. Advent of Coronavirus pandemic has also pushed companies to adapt to the changing market and make themselves digitally viable to increase online footfalls and add to their company value (Adamyk, 2019).
Identifying the regular changes in market is extremely crucial for a company to make strategic adjustments and maximise its profitability in the market. Tesco needs to conduct regular market analysis to gather in-depth knowledge and understanding of changes in market and predict future trends in the market. This will help them in preparing themselves and make arrangements through strategic planning on business moves of the company to increase their profitability. It is extremely crucial that company extensively engages in studying different macroeconomic trends and factors that impact market atmospheres of the countries where this company operates. Previous year, events such as advent of pandemic coupled with Brexit incurred significant losses for company, because of their poor strategic planning and lack of adaptability (Ebert and Duarte, 2018). Tesco needs to increase their adaptability and be able to change according to demands of market and customer requirements. It is also important for the company to make assessments of their competition market and regularly conduct competitive analyses to understand the trends along with evaluating saturation points and gap points in the market. Primary competitors of Tesco are ASDA, Sainsbury’s and Morrisorn’s in supermarket sector. These analyses will help Tesco to gain an understanding of their position in market and help to develop strategies to withstand crisis situations. This will also help them in understanding their strengths and leverage competitive advantage to incur profits in the business (Tabrizi et al. 2019). Tesco cna also employ PESTLE analysis and SWOT analysis are basic techniques to understand both their internal and external environment that this company operates in. This present company can also use digital technologies such as big data analytics, loT, artificial intelligence, etc., to implement and develop these strategies in the organization aspect.
In order to increase efficiency of company, Tesco’s executive authorities and leaders need to engage in effective and fast decision making. They play a major role in deciding their processes and procedures that this organization undertakes along with strategic implementation and adoption to increase efficiency of organization. This will help the company in increasing their company value and incur profitable dividend margins from respective markets. Digital transformation process requires leaders to make immediate decisions on a data driven basis, to increase their efficiency and organizational framework. These decisions will also define values and ethics that this present company follows and reflect their goals and objectives. Company leaders and authorities can employ different digital software which will enable them to obtain efficient data required to make changes and adjustments to suit and reach organizational objectives (Sebastian et al. 2020). These decisions will affect Tesco’s processes and business development in mass market. Gaining a clear understanding of environmental factors both outside and within organization will help Tesco’s leaders to make effective changes and adjustments required to increase efficiency and thus value of the company in market. Cost benefit analysis will help Tesco to assign clear goals and objectives in alignment with their company values and ethics.
Decisions taken by Tesco’s executive authorities and leaders need to be clearly conveyed to other stakeholders of Tesco. Efficient communication channels and regular data processing is also crucial for the company to affect these decision making. This will also help Tesco’s leaders in making informed data driven decisions. While making decisions, leaders need to include the opinions and suggestions of its stakeholders. Conducting an extensive and inclusive stakeholder analysis will help them become informed of their true position and value from a stakeholder’s perspective. Use of digital tools and software will also help in increasing their data information and help company to make informed decisions. Handling finances, managing organizational stakeholders and maintaining propensity of their organization operations are key functions of leaders (Sousa and Rocha, 2019). They must apply software systems which will help them in obtaining appropriate data needed to effectively transform the business digitally along with increasing their sustainability in functioning markets. Tesco can use ERP, EPM and other technologies available in market to effectively obtain data and maintain organization and management processes of the company.
Leading through an effective digital transformation also requires engagement of skilled personnels and professionals to ensure a smooth transition process along with aversion to risks and challenges entailing these transformational processes. It is extremely crucial for companies to employ strategies and techniques to acquire and engage skilled professionals into the organization. Employing skilled and experienced personnel will ensure in developing a healthy and positive environment within organization. These professionals must also primarily possess advanced technical knowledge in order to effectively support the digital transformation process of the company (Bloomberg, 2018). Leaders of organizations must also engage effective strategies to increase communication and collaboration between teams and increase their productivity and efficiency of company.
Employee motivation techniques and strategies need to be adopted by leaders in order to boost their enthusiasm and motivation of employees within this organization. Providing employees with both financial and nonfinancial benefits along with giving primary priority to safety and security of these employees will help in retention of skilled employees into the organization. According tp Awadari and Kanwal (2019), this also helps in improving its brand’s market image and helps in attracting skilled talents with higher efficiency into their organization. Leaders need to make effective decisions and be empathetic towards these employees in order to boost employee spirit and make them feel valuable to the company.
Keeping a lookout and engaging in various talent acquisition programs will also help this company gain driven and interested prospects into company. Effective talent acquisition strategies will help company attract new talents into company along with ensuring proper training topp these talents in order to increase efficiency of these talents to suit the goals and objectives of the company. Boosting motivation of employees will help the company to increase their productivity and efficiency. This will help in culturing a positive and energetic atmosphere within organization which in turn will help in delivering better service to customers. A productive and optimistic workforce will help in generating higher work efficiency and proficiency along with helping this company in incurring higher profits for the company (James and Cooper, 2021).
To increase efficiency through digital transformation, Tesco needs to implement different tools and technologies which will help in a seamless transition of traditional processes in the digital sphere. Leader of the organization needs to effectively lead through the digital transformation. For this purpose, leaders need to possess technical skills and knowledge which will help them in transforming their processes and make them ready for business in digital market. Ken Murphy, the present CEO of Tesco is one of the most important personnel in Tesco. He is foremost in ensuring and implementation of a digital ready culture in the company. Murphy has helped Tesco to effectively transform its business operation to suit the digital culture and ensure optimum service to its consumers. According to Wessel et al. (2021), customer oriented service of Tesco and implementation of their values and ethics into the company’s processes and procedures has been primarily purported by Murphy. Tesco has grown to become the third largest retailers in supermarket sector in a global scenario. Murphy has a major role behind the increasing revenue collection of the business in various markets. Murphy has earned the trust of the public and possesses in depth knowledge and skills required to steer through a digital transformation process (Kar, Bansal and Mishra, 2021). He needs to invest in building healthy relationships within the organization and ensure effective communication and collaboration among team members to increase the efficiency and productivity of Tesco. Employee motivation techniques and strategies need to be adopted by leaders in order to boost enthusiasm and motivation of employees within this organization. Providing employees with both financial and nonfinancial benefits along with giving primary priority to safety and security of these employees will help in retention of skilled employees into organization. Tesco also needs to become adaptable and effectively engage in analysis processes which will help company increase efficiency and proficiency of organization in various markets (Utami, 2018).
Collaboration tools and strategies enable companies to increase efficiency and productivity of the company in markets. Establishing proper and effective communication channels will help the company in organizing and increase their productivity and team building. Tesco can engage various digital tools and softwares which will help them in increasing collaboration within the organizational purview. Employee motivation techniques and strategies need to be adopted by leaders in order to boost the enthusiasm and motivation of employees within this organization. Providing employees with both financial and nonfinancial benefits along with giving primary priority to safety and security of these employees will help in retention of skilled employees into the organization (Heavin and Power, 2018). This also helps in improving the brand’s market image and helps in attracting skilled talents with higher efficiency into the organization. Leaders need to make effective decisions and be empathetic towards these employees in order to boost employee spirit and make them feel valuable to the company. Employee motivation tools help in boosting enthusiasm and encouraging employees to reach their optimal potential (Muli, 2019). Tesco can use ERP, EPM among tools to increase communication and collaboration among different channels of the organization. Organizational cohesiveness is also important in this matter. Enterprise applications and effective communication channels will increase collaboration among teams and increase their interest in company’s decisions. Tesco needs to ensure that company executives develop a department committed work on their databases and regularly obtain data and statistics and thus affect outcomes from various analysis and surveys and make comprehensive reports to the authorities in order to make informed decisions which will help them in making effective decisions to make a positive impact in the market (Correani et al. 2020).
Appointing an adept and skilled leader is extremely crucial in the process of digital transformation. The leaders of the organization must possess necessary qualities required to steer the company through a digital transformation and lead it through the process of transition. Leaders play a crucial role in attaining values to various processes of their organization and deploying necessary strategies in dealing with various situations faced by present company. Leaders need to be resilient during this digital change process and employ various effective tools in order to effectively lead through this change.regular training of leaders with accordance to advanced technologies helps leaders gain necessary knowledge and develop skills to increase their efficiency in organization. Leaders need to obtain different techniques and approaches to gain insights on company in different markets and analyze their position as such. Leaders can engage various digital tools and conduct stakeholders analysis through surveys for understanding their value and opinions of stakeholders and their interests. These communication techniques will also increase engagement of the stakeholders and assign value to their opinions and interests (Ziyadin, Suieubayeva and Utegenova, 2019). Along with this, emotional intelligence of leaders is also crucial in order to analytically lead organization through this digital transformation process. Leaders must exhibit an amount of self regulation to increase efficiency of organization. Leaders must also possess adaptability skills ensure proper implementation of modern tools and technologies in their organizational process. Their skill sets now require them to possess technical knowledge in proper application of these tools which will help them in incurring higher profits from the market. Staying calm and composed is extremely important for the leaders during the transformation process. Temperament of leaders help in deciding organizational culture and promote a healthy and positive work environment which increases their effectiveness and proficiency of their company (Warner, and Wäger, 2019).
In light of the above discussion, it can be concluded that Tesco needs to employ various digital tools in order to increase efficiency and proficiency of their organization in various markets. Tesco needs to become adaptable to suit the present situation and meet with the demands and requirements of consumers aligning with the interests of the market. Leaders need to engage various techniques and strategies to ensure a proper and efficient transformation process of the organization without hassles. Employing and engaging dynamic and skilled professionals is also crucial for Tesco to reap profits through their digital transformation. Employing modern tools and cloud technologies will increase communication and collaboration among teams and other stakeholders and thus increase value of the organization.
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