Find evidence that supports (or questions) the explanations in the case study of Tesco’s effectiveness

Question

What will be an ideal response?

Answer 1

The singular, dedicated leadership of Sir Terry and his senior management team: undeniable long term
continuity of approach and key personnel; promotion largely from within
The clarity of Tesco’s vision of growth via diversification and overseas expansion: actually an
incremental progression, being willing to learn in action and devoting resources adequate to each new
challenge. Overseas expansion applies tried and tested formulas, albeit modified and nuanced in light of
local practices and partners’ experience.
The application of appropriate resources and know-how to maintain growth in existing areas, to
innovate, and to enhance the prospect of success in each new area: as demonstrated by its balance sheet
and sales growth evidence. It may be an innovator in UK terms, but it has long had US retailing pioneers
to show it the way (e.g. Walmart)
Exploiting the capabilities of successful alliance partners, to distribute goods efficiently to its stores,
diversify, and develop overseas: a matter of fact
Developing expertise progressively in every activity by innovating and absorbing best practice observed
elsewhere: as already stated
Rewarding individual performance and promoting capable people: strong record of internal promotion of
competent staff who remain loyal to it.
By continuing to innovate in terms of its breadth of offerings and overseas expansion, Tesco has
exploited scale and scope economies that others (except Walmart) simply can’t emulate. Thus its current
advantage derives at least partly from exploiting its position, the consequence of historical innovation
and effective strategy implementation. Time will tell if present innovations will contribute as much to
future positional strength and success. All of the listed factors must make some contribution, though the
extent to which they genuinely confer advantage over competitors is hard to establish, even for insiders.
A reasonable hypothesis is that the culture of constant striving for improvement and progress inspired by
Sir Terry can be linked to every other factor. It is noteworthy that Tesco has hit on a combination of
mass-market and web-based retail formats that now appear to be the only ones likely to succeed in future,
excepting highly specialised and prestige retail store formats.