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Tesco Strategic Purpose

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There are a number of theories that have been developed with an aim of explaining strategic management processes within an organization. PESTLE analysis theory is one of the theories related to strategic management. The theory usually takes into consideration the political, economic, social, technological, economic and legal environments during the process of developing strategic purposes of a firm (Warner, 2010). The theory argues that the firm has to thoroughly scan the environment that it operates in order to identify trends that may affect its operations and to determine how its strategy will help the firm survive with the changing trends in the environment. Additionally, the theory helps in identifying opportunities and threats that are represented by various environmental factors enabling it to plan ahead on how to handle these factors to its advantage.!Tesco’s strategic purpose is aimed ensuring that the operation of the shop is built towards encouraging growth and meeting the ever-changing needs of the customer. Thus, the strategic purpose of the shop is to help in its reflection of priorities as it grows and the needs of the customer changes. Given that there are various factors within the environment that affects business growth and determine changes in the needs of customers, PESTLE theory can be applied in the strategic purpose of Tesco.! To start with, the theory can be used for analyzing how various political factors within the business environment of Tesco will determine the strategic direction that it will take in the future (Warner, 2010). The political climate within various countries that Tesco operates in determines the course of action to be taken by the management to ensure that the growth and meeting the needs of customers are not affected by the ever-changing political environment. Therefore, by analysing the political environment, Tesco will be able to develop business strategies that best suits different political environments where it has operations. On the other hand, the economic environment is of great importance when it comes to achieving the strategic purpose of the business to grow and meet the changing needs of its customers. The theory can be applied by Tesco in analyzing the economic environment in order to understand issues such as purchasing power of customers, interest rates, cost of production and their impact on the firm. Having an understanding of its economic environment, Tesco will come up with strategic measures that will ensure its growth and needs of its customer are given priority despite different prevailing economic condition in different markets around the globe.! Additionally, the theory can be applied in the strategic purpose of the company by helping in analyzing the social environment. The buying behaviors of customers are usually affected by the existing social trends within a given society. The types of products to be purchased by customers are determined by their social environment. Hence, it is vital for Tesco to make use of the theory and critically scan its social environment and determine how social trends may impact the achievement of its strategic purpose.!Tesco’s strategy for the last 20 years has been focusing mainly on the growth of the firm and channelling all factors in ensuring that the changing needs of the customer are met. As a result, the management of the firm has focused mainly on the internal environment of the business such as creation of brands that are highly valued, building of firm’s teams, increasing the number of products offered by the shop apart from its traditional food products and others. Therefore, the strategy of the firm in the past has been focusing on building a strong internal environment in order to achieve growth and meet customer needs. As a result, the strategy has ignored the external environment which is also critical to the success of the firm. The strategy has ignored issues such as legal, political, technological and social factors that are vital in enhancing the success of the firm.! Hence, in order to enhance its competitiveness and achieve its strategic purpose, it is vital for the management of Tesco to incorporate both the external and internal environment in its strategic plan. It is important to note that both internal and external environments have an impact on growth and realization of customer needs.


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