Table of Contents
Operations Management at Tesco Plc. 5
Effectiveness of Operations Management at Tesco Plc. 5
Techniques Used for Decision-Making and Problem-Solving. 5
Role and Functions of Operations Management 6
Contribution of Supply Chain.. 7
Solutions to Operations Management Decision-Making. 9
Modern Digital Techniques For Effective Operational Decisions. 10
Implementation of Various Techniques to Achieve Operational Performance within the Organisation 11
Recommendations and Solutions for Effective Use of Operational Techniques. 12
Approaches of Continuous Quality Improvement Adopted by Tesco Plc. 15
Continuous Improvement Plan.. 17
Critical View and Justification of the Plan with Solutions. 19
Role and importance of Strategic Risk Analysis. 20
Risk Identification and Mapping to Conduct SRA.. 20
Contingency Plans and Strategies to Manage Risks at Different Levels. 22
Part 1
Introduction
Operations management can be defined as the administration or management of business practices in an attempt to create a huge level of efficiency within a business organisation. With effective operations management, an organisation can increase its business efficiency by providing the best quality services and products which helps in maximising the overall profitability of the business (Kumar, 2022). Based on this, the report addresses the operations management of Tesco Plc. It includes an introduction of the organisation for analysing its effectiveness in operations management. It explains the functions and role of operations management using the 4Vs framework, critically evaluates the relationship between organisational strategic objectives and effective operations management decisions, and provides solutions to various operations management decision-making through different techniques and frameworks. It also defines the role of modern digital techniques for making effective operational decisions and evaluates the implementation of those techniques for problem-solving to accomplish effective operational performance. In the end, it provides recommendations and solutions for the effective use of operational techniques to achieve organisational objectives.
Operations Management at Tesco Plc.
Tesco Plc. is a British multinational retail supermarket that was founded in 1919 by Jack Cohen. It is headquartered in England, UK and this supermarket chain operates in around 12 countries and employs 345000 employees around the world. One Stop, Booker, Makro, F&F, and Premier are some of the brands of Tesco Plc. The organisation carries out its business through physical as well as online stores. The stores of Tesco Plc. are also operated in different formats based on their size and varieties of products sold (Tescoplc, 2023).
Effectiveness of Operations Management at Tesco Plc.
The operations management of Tesco Plc. is very effective as it significantly helps in satisfying the needs of the customers and achieving the organisational goals. Operations management of Tesco Plc. plays an important role in controlling the resources that are used for transferring and producing services and products (REID and SANDERS, 2019). Tesco Plc. always ensures to maintain the effectiveness of its stores to attract huge customers. To provide an effective shopping experience to customers, the main working operations of Tesco Plc. includes filling shelves, maintaining cleanliness, and delivering goods. Other than customers, suppliers, employees, and shareholders are the components that hold huge importance for the organisation (Tescoplc, 2023).
Techniques Used for Decision-Making and Problem-Solving
For better decision-making, Tesco Plc. uses a control system and inventory analysis that provides the organisation with valuable information that helps in making decisions about products, sales, and purchasing. This technique facilitates Tesco Plc. in developing information systems that update the stock by generating reports for managers for checking the status of inventory in opposition to forecasts (Turgut, Kose, Ustundag and Cevikcan, 2022).
Tesco Plc. also emphasise lean manufacturing which helps the organisation to solve problems of managing large batches. This problem-solving technique helps the organisation to provide instant value and maintain the accuracy of the stock records (Palange and Dhatrak, 2021).
Role and Functions of Operations Management
The role of operations management in an organisation revolves around the management of processes, resources, and staff. Its functions ensure the effective and efficient use of these resources for accomplishing the goals of the organisation (REID and SANDERS, 2019). Some of its functions include:
Product Design- The operations management of product design involves developing effective methods for product manufacturing and service delivery so that it can meet the needs of customers while being profitable for the organisation (Kumar, 2022).
Forecasting- It is an important process that helps the organisation to set long-term production goals. It facilitates decision-making about staffing, capacity, and inventory levels and helps an organisation avoid overproduction (REID and SANDERS, 2019).
Quality Control- Tesco Plc. highly focuses on the quality of products and services offered by it. For this, it has developed quality control procedures and also train employees in techniques of quality control (Kumar, 2022).
Finance- This operations management function focuses on financial resource management. This helps organisations to understand budgeting, accounting, and forecasting to improve decision-making and increase profitability (Kumar, 2022).
4Vs Framework
The 4Vs framework of operations management involves four dimensions namely volume, variation, variety, and visibility. This framework can help in analysing the effectiveness of operations management at Tesco Plc.
Volume- This dimension depends on the number of customers served by the organisation. Tesco Plc. has a large number of stores which contains cheaper products as compared to smaller products. It buys products in bulk which minimises changeover cost and increases unit cost (Slack, 2018).
Variety- The employees of Tesco Plc. are prepared to offer standardised services. They provide a medium to a low variety of services to the customers including assisting customers in shopping and billing (Tescoplc, 2023).
Variation- This dimension deals with variations in the demand for products and services. This variation can be easily predicted by Tesco Plc. during festive seasons but not effectively on normal days (Lin and Peng, 2018).
Visibility- This dimension provides information about the internal working of the organisation to the customers. Some operations of Tesco Plc. such as supply chain and inventory management is not visible which indicates low visibility operation (Slack, 2018).
Contribution of Supply Chain
The supply chain management of Tesco Plc. highly contributes to increasing the effectiveness of its operations management. The organisation maintains an excellent inventory level as its suppliers make deliveries at fixed times at the grocery stores and depots. The organisation also determines the number of products that should be provided to each store which helps in maintaining on-shelf availability. Thus, it can be said that the supply chain of Tesco Plc. contributes to increasing the effectiveness of operations management (Sparks, 2019).
Relationship between Effective Operations Management Decisions and Organisational Strategic Objectives
Operations management decisions play an important role in improving the efficiency and reputation of the organisation. It creates a positive influence on the capability of the organisation to achieve organisational tactical strategic objectives. Tesco Plc. focuses on making effective operations management decisions that help the organisation to meet product-quality standards and customer satisfaction (SLACK and BRANDON-JONES, 2019).
Tesco Plc. highly focuses on the speed of delivery so that it can quickly meet the expectations of the consumer. The decision of implementing an advanced information system in its online delivery service effectively helps the organisation to offer goods quickly to the customers (Lin and Peng, 2018).
|
Benefits |
Limitations |
|
This helps Tesco Plc. to meet the demand of consumers and maintain supply dynamics by recording real-time stock (Lin and Peng, 2018). |
The maintenance of this system needs a huge cost and any technical error may lead to the storage of incomplete or incorrect data (Rainer and Prince, 2021). |
For increasing the effectiveness of its operations management, Tesco Plc. has decided against implementing an analytics model in its supply chain. This decision of the organisation is effectively helping in predicting the buying habits of its consumers (Seyedan and Mafakheri, 2020).
|
Benefits |
Limitations |
|
The analytics model in the supply chain helps Tesco Plc. to stock store shelves according to the buying habits of customers and to determine the effectiveness of special offers provided to them (Seyedan and Mafakheri, 2020). |
Analytics in the supply chain may lead to certain disruptions as predicting human behaviour completely is not possible which creates insufficiency in future predictions (Seyedan and Mafakheri, 2020). |
Solutions to Operations Management Decision-Making
Some techniques and frameworks for efficient operations management decision-making involve:
Analytic Hierarchy Process (AHP)- This decision-making technique can help Tesco Plc. in making complex decisions. This technique mainly focuses on identifying decision criteria and options, conducting comparisons between criteria and decision options, and calculating the importance of each criterion (Sharma, 2018).
Cost-Benefit Analysis- This decision-making technique can help Tesco Plc. to make finance-based decisions effectively. It helps in acquiring and analysing financial data to make effective operations management decisions. The cost-benefit analysis also helps in offering evidence-based evaluations which makes the decisions logical and effective (De Rus, 2021).
Game Theory Framework- This framework can effectively support Tesco Plc. in making strategic decisions while negotiating with third parties. Third parties can involve, clients and competitors and helps in developing strategic interaction among the negotiators (Deng and Jiang, 2019).
Influence Diagram Approach (IDA)- This technique can be used by Tesco Plc. to reduce the chances of human errors in making operations management decisions. This solution aims to guide through a visual aid that helps in determining human error which can affect the quality of decisions (Black, 2023).
Modern Digital Techniques For Effective Operational Decisions
Some modern digital techniques of effective operational decisions involve:
Big Data Analytics- Big data analytics is an effective technique that helps in creating valuable insights into the operations management of the business. Tesco Plc. utilises big data analytics to identify problems, predict future trends and customer behaviour, and optimise processes. The technique efficiently helps the organisation in effective supply chain management (Feki, 2019).
Artificial Intelligence (AI) Algorithms- Artificial intelligence can effectively help in making and supporting decisions in an organisation. Tesco Plc. uses artificial intelligence algorithms for extracting useful information. This information is used to make useful predictions and interpretations that effectively help in making operational decisions (Nguyen et al., 2022).
Virtual Reality- Virtual reality is one of the effective digital techniques that help helps in making informed decisions. Virtual reality helps in visualising the potential outcomes of the decisions made within the organisation. It facilitates decision-making in different business fields including marketing and product development (Michalos et al., 2018).
Centralised Repository- A centralised repository can effectively help in making operations decisions within the organisation. In this digital technique, the key information and data of the organisation are stored in a centralised repository. This data helps in making critical decisions and avoiding biases toward options. Also, it ensures a faster and more efficient process of decision-making (Aftab and Siddiqui, 2018).
Implementation of Various Techniques to Achieve Operational Performance within the Organisation
Virtual Reality- Virtual reality can help Tesco Plc. to offer more personalised experiences to its customers. It can provide an opportunity for employees to learn new techniques and increase the engagement of customers towards the organisation. To implement virtual reality techniques effectively within the organisation, Tesco Plc. is needed to organise training programs where employees can learn about the technology and use it efficiently. Virtual reality can also facilitate Tesco Plc. to solve the problems of product design innovations which help the organisation in gaining a competitive edge over its rivals (Michalos et al., 2018).
Centralised Repository- Centralised repository can effectively help Tesco Plc. to manage and maintain data efficiently. It can help in avoiding data duplication and constant synchronisation. Through this, the employees of Tesco Plc. can work in a centralised workflow and can be able to make accurate and organised decisions. For implementing this digital technique, Tesco Plc. needs to organise a data warehouse that offers a platform to ask queries about the information of the organisation (Aftab and Siddiqui, 2018).
Artificial Intelligence- Artificial intelligence is an effective digital technique that can help Tesco Plc. to solve problems demand forecasting and customer support. Through this, the company can learn about the customer base and can analyse their buying behaviour which helps in avoiding stock-related and overproduction problems. Also, it can support the organisation with long-term demand forecasting which helps in avoiding logistics and supply chain issues. Tesco Plc. can effectively implement AI through Chatbots, machine learning, and algorithm trading for increasing its operational performance (REID and SANDERS, 2019).
Recommendations and Solutions for Effective Use of Operational Techniques
To increase its organisational objectives in a complex and dynamic trading environment, it is important for Tesco Plc. to use operational techniques such as virtual reality, artificial intelligence, and a centralised repository. These techniques ensure increased operational efficiency which can help in achieving the strategic objectives of the organisation. To make effective use of these digital techniques, it is recommended to Tesco Plc. train employees on the systems so that they can implement their best practices and increase the efficiency of the operations (REID and SANDERS, 2019).
To enhance customer service, Tesco Plc. can implement digital techniques such as artificial intelligence, virtual reality, and big data analytics. Through this, it can predict future trends in customer behaviour and develop strategies that will attract huge customers and increase its sales and profitability (Feki, 2019).
Conclusion
From the report, it is concluded that Tesco Plc. has effective operations management in terms of speed, cost, quality, flexibility, and dependability. These efficiencies are the major strengths of the organisation. However, Tesco Plc. experiences some weaknesses in developing lean operations management. Thus, it is required by the organisation to develop some innovative strategies to improve its operations management.
Part 2
Introduction
Continuous quality improvement is the method of improving or developing the quality of services, operations, and outputs in a business context (O'Donnell and Gupta, 2022). This report aims to apply the concept of continuous quality improvement in the operational context and to apply the strategic risk analysis (SRA) to the operations functions of Tesco Plc. The report includes a range of approaches to continuous quality improvement, continuous quality improvement plan, justification of the plan and approaches to achieve sustainable performance and organisational goals, role and importance of strategic risk analysis, range of contingency plans and strategies to manage risk at different levels, and suitable recommendations on the importance of SRA in complex and diverse environments.
Approaches of Continuous Quality Improvement Adopted by Tesco Plc.
Tesco Plc. is a large organisation with a huge number of stores and multiple locations across the world. For such a huge corporation, it is very important to deliver high-quality services to the customers and increase process efficiency which can be achieved by continuous quality improvement (CQI) (O'Donnell and Gupta, 2022). Some approaches to CQI can be adopted by Tesco Plc. include:
Six Sigma- This is one of the approaches of CQI that aims to identify and eliminate the causes that are responsible for problems and defects in the processes and outputs of the organisation. This approach consists of five steps including define, compute, analyse, upgrade, and control. This can effectively help Tesco Plc. to ensure safety and quality in its products and services (iCert Global, 2023).
Lean- It is a CQI approach that focuses on avoiding redundancy and waste within existing methods and procedures. This approach can effectively work for large organisations such as Tesco Plc. in eliminating waste and improving quality and efficiency (O'Donnell and Gupta, 2022).
PDCA Cycle- This approach of CQI helps in addressing the social problems within an organisation. It is a continuous loop to plan, do, check, and act which helps in solving issues, and implementing change simply and effectively. This can provide an opportunity for Tesco Plc. to test improvement before updating working practices (Kanbanize, 2023).
Continuous Improvement Plan
The continuous improvement plan is a deliberate decision that helps an organisation to focus on improving the procedures and methods and to implement innovations for improving services and products. The operational activities of Tesco Plc. are all based on providing the best services and products to the customers so that they can achieve a simpler but better lifestyle. The operational activities of the organisation are to improve the quality of the services and products and to enhance the availability and delivery of the product to the customers (Denis, 2023).
Based on this, the continuous improvement plan for Tesco Plc. includes:
Planning- In this phase, Tesco Plc. can identify the issues related to operations management that is customer support, and demand forecasting and determine its root cause with the help of relevant data (Denis, 2023).
Doing- In this stage, Tesco Plc. can develop and implement solutions such as Artificial Intelligence and Virtual Reality with effective measurement to understand their quality and effectiveness. The organisation is needed to implement strategies to improve the efficiency of its operations management team in providing customer support (Peças et al., 2021).
Checking- In this phase, it is important for Tesco Plc. to check the outcomes before and throughout the implementation of operations management techniques such as AI, VR, and big data analytics (Denis, 2023).
Acting- In this stage, Tesco Plc. is needed to document the results of the test implementation so that it can create awareness about it among the employees of the organisation (Peças et al., 2021).
Critical View and Justification of the Plan with Solutions
The continuous improvement plan that is the PDCA cycle can effectively help Tesco Plc. to check the efficiency and effectiveness of digital operations management techniques such as AI, VR, and big data analytics and can implement within the organisation to support customer services and product design (Mariani and Nambisan, 2021).
The PDCA plan has numerous advantages which include:
- It ensures constant improvement which allows Tesco Plc. to identify upcoming issues and test and implement effective solutions for them.
- The iterative approach provided by the PDCA plan helps Tesco Plc. in efficient analysis and control over solutions and operations (Taufik, 2020).
However, some of the disadvantages of the plan include:
- The planning of changes must be done for a long time before implementing final solutions.
- It will affect the ability of Tesco Plc. to act proactively and emphasis considering every possible aspect (Taufik, 2020).
Thus, the PDCA plan is highly effective for solving problems and creating quality improvements within the organisation. By checking the efficiency of digital techniques such as big data analytics, artificial intelligence, and virtual reality, Tesco Plc. can effectively respond to the issues of customers. Also, making predictions will help in providing quick and efficient solutions that can help the organisation to address the problems in the long term. These solutions can effectively help Tesco Plc. to achieve its organisational objectives and sustainable performance (Foulla, 2021).
Role and importance of Strategic Risk Analysis
Strategic risk analysis (SRA) provides an opportunity for the senior management authorities of the organisation to think about the future and to make strategic decisions to solve the issues and problems immediately. Strategic risk analysis plays an important role in determining and assessing the factors that could adversely impact the success of the organisation. It helps in examining the risks and helps in deciding what move should be taken that supports the growth and development of the organisation (Andersen and Sax, 2019).
Risk Identification and Mapping to Conduct SRA
Some of the top risks that can pose a threat to the operational performance of Tesco Plc. include changing customer buying behaviour, supply chain risks due to rising inflation, and the inability to predict future changes (Hubbard, 2020).
Risk Prioritisation
|
S No. |
Risk Factors |
Impact Score |
|
|
Changing customer buying behaviour |
5 (VH) |
|
|
Rising inflation |
4 (H) |
|
|
Inefficient predictions |
2 (M) |
Contingency Plans and Strategies to Manage Risks at Different Levels
Establishing Diversified Suppliers- As Tesco Plc. has operations in multiple countries, it can establish relationships with diversified suppliers so that it can mitigate the risks of rising inflation in the future. Through this, the organisation will be able to get raw materials and products from the suppliers of the country at lower rates (Cui and Idota, 2018).
Investing in Artificial Intelligence- Making investments in artificial intelligence can help Tesco Plc. to predict the future trends and future buying behaviour of customers with accuracy. Through this strategy, it can analyse customer trends and develop the strategy accordingly (Abrardi, Cambini and Rondi, 2022).
Big Data Analytics- By embracing the technology of big data analytics, Tesco Plc. can become able to uncover patterns and trends and correlate effectively. This can help the organisation to make informed decisions based on statistical analysis and can mitigate the risks of inefficient predictions to an extent (Vassakis, Petrakis and Kopanakis, 2018).
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