Last Updated 10 Aug 2020

History and organisation of Tesco

Category History
Essay type Process
Words 955 (3 pages)
Views 477

Tesco has a longstanding history of success in business since it was founded in 1919 by Jack Cohen. During this time Cohen sold surplus groceries from a stall in the far east of London. The company produced its first brand in 1924 after Cohen bought tea shipment from T. E. Stockwell, a supplier whose initials and the first two letters Jack’s surname form the company name. However, it was not until 1929 when Tesco opened its first store in Burnt Oak, Middlesex. Available information indicates that the company was first listed on the London Stock Exchange in 1947 under the name Tesco Stores Limited. In addition, Tesco limited moved ahead to open its first self-service store and supermarket in St Albans (1951) and Maldon (1956) respectively. True from available literature, Tesco gained much business advantage by opening numerous stores and business acquisitions, a move that saw an increase in the number of stores to 800 during the 1950s and 1960s. The quest for competitive advantage in the marketplace prompted the company to diversify its business from the original food and drink to other products and services.

Currently, the organization's business covers areas like clothing, electronics, financial services, and insurance cover services for home, health, and cars. Still, the company engages in other businesses such as the renting and retailing of telecommunication, DVDs, and Internet services as well as music downloads. Since the 1980s, Tesco Stores Limited has evidently expanded its business holdings to become the largest retail company in the UK as well as gaining significant business dominance in over 13 countries across the globe. In 1987 for example, the company managed to turnover Hillard's chain of supermarkets. Moreover, it gained a competitive business presence in Scotland after acquiring William Low chain of supermarkets. Other competitive business moves by the company include its success in introducing loyalty cards, Clubcard. Just to note is the fact that Tesco Company was the first retail store to make online shopping profitable. The company started its operations in the US after acquiring a 35% stake in GroceryWorks in 2001.

In the communication field, Tesco purchased the C Two-Network in Japan and launched mobile and home phone services as well as internet services in the UK during 2003. The company is constantly engaged in innovative business as can be evident from its 2009 announcement that it had created a super tomato. Tesco stores limited have adopted two structures of corporate management to ensure its management efficiency. The first structure is the executive arm of the organization as a whole. This structure is comprised of the board of directors who oversee the process of monitoring the performance of stores and making executive decisions. The other structure is localized management which deals with ensuring the realization of division objectives. Through this structure, the company enjoys the advantage of promoting effective employee and customer engagement practices at the individual stores. In addition, the structure has been praised for ensuring that employees and customers can easily gain access to relevant departmental assistance thus promoting efficiency in service provision.

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Terry Leary was born on 28 February 1956 in the Belle Vale district of Liverpool. His career with Tesco started early in his life when he was attending St Edward’s college. During this time, Leahy used to work in the Wandsworth, London-based Tesco branch over the holidays; stacking shelves and washing floors. In 1977, he graduated with a second upper-class honors degree in management science from UMIST. He joined Tesco as a marketing executive in 1979. In this position, Leahy appreciated that the success of Tesco in the market was limited by its marketing strategy. According to available information the company engaged in following the business strategies of two major brands of the time; Marks & Spencer and Sainsburys, most profitable retailers of the time. This prompted his decision to influence Tesco in implementing the Tesco Clubcard loyalty program. True from available literature, Leahy was the driving force to the success of the program. This was executed through his effective strategy for monitoring the shopping habits of Tesco Clubcard holders.

In 1992, he was appointed to the company’s board of directors was he played an influential role which saw Tesco grow to become the biggest retailer in the UK in 1995. Leahy becomes the chief executive officer of Tesco in 1997 following the retirement of the then CEO Lord MacLaurin. Since his promotion to the CEO position, Tesco has strongly defended its stand as the largest and most profitable retailer in the UK as well as making numerous business expansions into the international market, a move which saw its profit margin hit the ? 2 billion mark in April 2005. His success as the CEO of Tesco can be asserted from the numerous honors he has received. In 2003, he was declared the Britain's "Business Leader of the Year". In 2004, he was selected as the Fortune European Businessman of the Year followed by the move by the Management today terming Leahy the most admired business leader in Britain in 2005. In addition, Leahy was elected a co-chancellor for the University of Manchester in 2004 and given a doctor in science honor in 2007 from the Cranfield University. Though planning to retire as the CEO of Tesco in 2011, Leahy will go in historical records as the most influential in the success of Tesco both locally and internationally.

Reference

  1. Alan, M 2009, "There Is More in Store for Tesco with T&S Buy," Marketing Week, vol. 32, pp. 30-34. Clark, T 2008.
  2. A history of Tesco: The rise of Britain's biggest supermarket, viewed 19 August 2010, http://www.telegraph.co. uk/finance/markets/2788089/A-history-of-Tesco-The-rise-of-Britains-biggest-supermarket. html>
  3. Lauren, M 2004, "Terry's All Gold at Tesco," In-Store, vol. 38, pp. 15-19. Strategic Planning: Tesco - Activity, <http://www.bized.co.uk/educators/16-19/business/strategy/activity/strategic1. htm> Vallely, P 2009.
  4. <http://www.independent.co.uk/news/people/profiles/tescos-finest-sir-terry-leahy-1804379.html>

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