BUSINESS OPERATIONS AND MANAGEMENT-ASSESMENT 1

BUSINESS OPERATIONS AND MANAGEMENT-ASSESMENT 1

Assessment 1

Introduction

The paper given below discusses the concept of business operating and management. The main functions of business management will be listed in this paper. Marketing, research & development, sales and customer services are the most important function for a business organisation. Tesco’s supply chain management, logistics, location strategies, human resource management, production department along with proper facts and statistics will be analysed in this paper. Essential sub-departments of these functions with the organisational context will be studied in detail. The document will throw light upon all the aspects of business operations and functions related to business management.

Explanation of the main functions of the business operation

Marketing: Marketing is a function that maximises the reach of products to its target audience. Personal selling, advertising, branding, hoardings, press releases are some examples of marketing. As quoted by Gbadamosi, (2019) due to the emergence of digital marketing today's buyer is more aware of his requirements, hence marketing can be used as an element to give information to its buyers.

Product: Product is a compiled outcome of various procedures like manufacturing, packaging and labelling. Product sustainability is important to minimise risks related to products (Dyllic and Rost, 2017). Tesco offers a variety of good quality products and services to its customers. Products categories offered by Tesco include toys, apparels, appliances, groceries, raw food products and processed food.

Pricing: Pricing is the value of products and services offered by the organisation. Pricing is an important factor which decides the profit margin and affects the sales factor. Tesco has kept the prices of its products that can match the worth of products and are affordable to its customers.

Place: Place is a platform created for selling the products and services. The products offered by Tesco are placed in various supermarkets and shops.

Promotion: Promoting a product or service means getting vocal about its plus points. Tesco takes the assistance of various promotional activities like advertisements, hoardings and allows its products on discounted prices.

Research and development: In this era of rapidly growing technology, research and development have become an inseparable part of the production. Without R&D no organisation can set apart in any department related to marketing. Marketing requires researching about customer preferences, target audience, segmentation, techniques and trends. Tesco has appointed a dedicated team to technology and development, this team aims in innovating products.

Selling: Sales is the indicator used for acknowledging the growth, profit maximisation, recommendation of the brand among customers and forecasting future objectives. The demand and supply factors are linked by the sales function. Various types of advertising, marketing, promoting factors are used by Tesco to increase sales and customer satisfaction.

Customer preferences: Customer is regarded as the king of the market. The preferences, likings, demographic background of customers play a vital role in framing marketing strategies. Price, place, product and promotion four pillars of marketing are inter-related to customers. As suggested by Klenow et al., (2020) it is observed that offline retailing organisations are hugely dependent on the number of customers visiting their stores. A flawless customer strategy requires well-maintained data of customers. In Tesco, data helps in analysing a number of customer visits, purchases made by them and stock which still pending. LIFO (Last In First Out) and FIFO (First In Last Out) serve like helpful techniques in accumulating data regarding inventory and sales. Customer services have an important role in expanding the customer base and keeping them tied to the organisation.

Description of the organisation

A huge chunk of the UK economy runs on the shoulders of the retail sector. Various retail organisations have played a vital role in feeding the needs of people and the growth of the country. One of such organisations is- Tesco. In the year 1919, John Cohen established Tesco. The headquarters is situated in Welwyn Garden City, United Kingdom. The grocery merchandise has later split into selling apparels, electronic devices, toys, and telecommunications and emerged as internet service providers (tescoplc.com 2021). In 2016, Tesco registered the 15^th rank in the list of most prestigious retail brands, globally. Tesco has roughly around 25 per cent of the market share and considered into the list of leading online retailing brand (statista.com, 2020). The Tesco group has spread its roots in nine nations as autonomous grocery retailing chain. There are near about 7005 Tesco stores across the world out of which 3968 are operated in the UK itself. The year 2019, recorded 319,303 employment opportunities created by Tesco in the UK. As per data acquired in 2020, over 100,202 people got employed by Tesco worldwide. The recent research on Tesco states that the brand has a global revenue of 10.6 billion. Total sales made by Tesco accounted for 64.8 million (tescoplc.com 2021).

Evaluation of organisation operation management decision

1) Production: Production department is the backbone of every organisation. The process of production involves few steps namely- planning, researching, designing, manufacturing and post-production. Planning is related to forecasting the whole process well in advance, researching means fetching the channels of raw material, designing involves predicting the look of the product. As opined by Abreu-ledon et al., (2018) the process of making is termed as manufacturing and packaging, labelling comes under post-production. As far as the production process of Tesco is concerned, it has a very well synchronized approach.

It can be concluded that the Tesco team keenly observes the production team at every step. The production expert team ensures that the quality of products is matching the standards. Products and ingredients used while manufacturing have some specifications and they should necessarily meet those details. Tesco also makes sure that the sourcing supplies are responsible, reliable and sustainable. Therefore, it is made clear that there is a separate source team that keeps the close check on sourcing processes.

2) Supply chain: The process of supplying raw materials to the manufacturing unit, using various channels is termed as supply chain management. SCM is nothing else but ensuring channels of supplies and all other factors related to turning raw materials into the final products. Absence of an efficient supply chain system would lead to the collapse of a production system. As per suggested by Brinch (2018), the function of supply chain management involves finalizing sources of supplies, maintaining stock, keeping daily data, presence of labour and so on. Labour plays a vital role in SPM. Transporting the raw material, loading, unloading require men-power. Cost control and keeping note of expenses is an important thing. Maintaining inventory, keeping a record of raw materials and ensuring the availability of sources like transportation, warehousing is also necessary. Logistics and distribution of goods enable maintenance of stock. Tesco has a distinct goal regarding the supply of goods which is based on the motto of providing its customers what they want at the right time and the right place. It can be concluded that the supply chain system of Tesco is designed in such a way that there should be the flawless transmission of raw materials from farms and factories to the shelves of Tesco stores. Once the products have hit the floor Tesco ensure there should be Fastrack delivery of products to its customers.

3)Logistics: Logistics covers all the factors like warehousing, designing products, location of the plant, choosing a market location, deciding market sources, setting up a dealer network and so on. In the opinion of Kadlubek (2018), logistic management maintains a balance between supply and demand. The only thing that sets apart logistics from supply chain management is that logistics covers the concept of demand while SCM focuses on the supply side. Logistics counts costs of warehouse management, handling inventory, packaging expenses, the loss incurred at the time of maintaining storage.

Logistics is the impactful driver of grocery retailing brand-Tesco. In 2018, the collaboration of Tesco and Carrefour affected sales of Tesco (forbes.com, 2018). Both brands have their respective supply chain management and logistic function. For effective cost control approach, both the retail sectors can merge their logistic approaches. Tesco has implied Artificial Intelligence for logistic management. It believes in the smart use of technical tools in various functions like planning inventory, storing inventory, production, delivering products and many more

A brief description of logistics is as follows:

Warehouse management: A warehouse is a place utilized for keeping the excess stock. Logistics cover all the expenses related to warehousing. Taxes, transportation cost, labour, electricity expenses and even loss incurred while maintaining stock in storages. Tesco ensures that its warehouses are kept tidy and clean plus the stock should be placed and maintained according to prescribed standards. The retail organisation incorporates Artificial Intelligence and mechanics in warehouse management.

Delivering products to customers: Logistics not just manages pre-delivery functions but also manages the post-production process. LM makes it possible to keep data of inventory and recording information of sales and items that are out of stock. Tesco has initiated the plastic-free delivery of goods by encouraging the placement of online orders. While serving on the floor customers Tesco requests them to bring their carrier bags.

4) Location strategies: Location plays a vital role in operation management. Selection of the right location is essential to ensure availability products at the right place and on the right time. Location is any place that holds the raw materials and the finished products and ensures their reach when they are in demand. Choosing the wrong location adds on into transportation, communication, inventory control and other such expenses. Tesco chooses those locations for its stores and supermarkets which are convenient to its customers.

Accessibility: Location which is accessible to unit members, staff and also to the customers is no less than a boon. Tesco's supermarkets have access to their target audience.

Political environment: Excessive political interference creates obstacles in the routine activities of an organisation. In the words of Kozubikova et al., (2019) political factors have long term impact on the sustainability of the business organisation. Similarly, big brands like Tesco also face some tariff duties and have to adhere to political rules and regulations of the region in which its stores are situated.

5) Quality control: In this era of cut-throat competition, it is essential to maintain quality and authenticity. Today's customer is highly aware of his demands, requirements, a quality he deserves and also about the alternatives which can offer him the same product. Amidst this highly competitive and aware environment is essential to keep a hold on quality and other factors that influence the quality of products. Tesco ensures that the quality of its products not just meets the customer demands but exceeds them (tescoplc.com 2021). The quality control team in Tesco doesn't compromise on quality and strive to lend products that are of great quality and value.

6)HR: Production, marketing, financing or any other department works only because of efforts of human resources. The absence of human resources leads to stoppage of work. Henceforth, the effective management of human resources becomes necessary. HR force in Tesco works in supermarket chains, customer service desks, quality control check and so on. Human resource management deals with the following activities:

Recruiting people: Recruitment is the process of considering individuals for the selection process. According to Carbonell et al. (2020), the individuals are recruited based on their skill sets, potential, educational background and their qualities relevant to the job description. Organisations like Tesco hire people based on their zeal for work and enthusiasm to learn.

Selection: The suitable candidates are hired for vacant positions. Some organisations like Tesco provide training and development to its employees.

Training and development programs: In several organizations like Tesco training and development to employees is given. Such programs help individuals to brush up their skills and develop a sense of professionalism within them. Employees get well know to the work environment of the organisation. Training and development also help them to take a closer look at their job role.

Effective leadership: There are various theories of leadership under human resource management which have proven to be very effective. Leadership ensures extracting potent of individuals working in Tesco.

Conclusion

This paper discussed various important functions of business operating and management- marketing, sales, customer satisfaction and research and development. Marketing principles, the purpose of R&D and the influence of customer satisfaction is explained as important subheads of operational functions. A brief analysis of Tesco, its revenue, employment base has also been stated in this paper. Further, some instances revealed how efficiently Tesco is managing its operations. In a nutshell, it is concluded that business operation and management is a concept as wide as the ocean and it has varied functions. Effective strategies and due consideration to these functions are required to fill the efficiency in business management.

References

Abreu-Ledón, R., Luján-García, D.E., Garrido-Vega, P. and Escobar-Pérez, B., 2018. A meta-analytic study of the impact of Lean Production on business performance. International Journal of Production Economics, 200, pp.83-102.

Brinch, M., 2018. Understanding the value of big data in supply chain management and its business processes. International Journal of Operations & Production Management.

Carbonell, N., Nassè, T.B., Ouédraogo, A., Kafimbou, B.H., Ampofo, J.A. and Kinda, M., 2020. Recruitment methods and performance: an evidence from businesses in Burkina Faso. International Journal of Management & Entrepreneurship Research, 2(4), pp.262-272.

Dyllick, T. and Rost, Z., 2017. Towards true product sustainability. Journal of Cleaner Production, 162, pp.346-360.

Forbes.com 2018 logistics in Tesco [Online] Available At: https://www.forbes.com/sites/brittainladd/2018/07/02/tesco-and-carrefour-how-their-strategic-partnership-can-grow/?sh=4e9e8b8a28ba [Accessed on: 5^th February 2021].

Gbadamosi, A., 2019. Contemporary issues in marketing: Principles and practice. Sage.

Kad?ubek, M., 2018. QUALITY AND LOGISTICS IN BUSINESS MANAGEMENT. In 5th International Multidisciplinary Scientific Conference on social sciences and arts SGEM 2018 (pp. 801-808).

Klenow, L.E.P.J., Levin, J.D. and Murciano Goroff, R., 2020. Customers and Retail Growth.

Ngarava, S. and Mushunje, A., 2019. Marketing mix strategy determinants in pork-based agri-businesses: Experiences from Zimbabwe. Acta Commercii, 19(2), pp.1-9.

Statista.com 2020 about Tesco [Online] Available At: https://www.statista.com/topics/3807/tesco-plc/ [Accessed on: 5^th February 2021].

Tesco.com 2020 about Tesco [Online] Available At: https://www.tescoplc.com/about/ [Accessed on: 5^th February 2021].

Tescoplc.com 2021 quality control in Tesco [Online] Available At: https://www.tescoplc.com/sustainability/publications/policies/downloads/product-safety-quality/ [Accessed on: 6^th February 2021].