Student Self-administered case study

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Tesco:useofITand
informationsystems
IntroductiontoMIS

45-60

Case duration (Min):

Management Information Systems (MIS)

Introduction to MIS
Business functions and supply chains

Worldwide
Case summary:

Learningobjectives:
Identifytheroleofinformationresourceswithintheorganization

Caseproblem:
Howcantechnology(IT)asapartofthebroaderinformationsystembeusedtohelp
organizations?

GroceryStores

Company

Studentsshould
determinewhat
constitutesITandIS(their
differentformsand
categories);whoandhow
theycanhelp
organizations(different
benefitsatthestrategic
competitiveadvantage
andenablinggoal
attainment,tacticaland
operationallevels)

ThecaseinvestigatesTesco'suseofIT/IS

Tesco
www.tesco.com

Foundedin1919inLondon,TescoplcisaBritishbasedinternationalgroceryandgeneral
merchandisingretailchain.Withrevenuesof60billion(2009),itisthelargestBritishretailer
bybothglobalsalesanddomesticmarketshare,withprofitsexceeding3billion.Withalmost
500,000Employees(2009)andover4000storesTescoiscurrentlythethirdlargestglobal
retailer.Originallyspecialisinginfoodanddrink,ithasdiversifiedintoareassuchasclothing,
consumerelectronics,financialservices,telecoms;home,healthandcarinsurance,Internet
services,andsoftware.
Tesco'sUKstoresaredividedintosixformats,differentiatedbysizeandtherangeofproducts
sold:TescoExtrastoresarelarger,mainlyoutoftownhypermarketsthatstocknearlyallof
Tesco'sproductranges;Tescosuperstoresarestandardlargesupermarkets,stockinggroceries
andamuchsmallerrangeofnonfoodgoodsthanExtrastores;TescoMetrostoresaresized
betweenTescosuperstoresandTescoExpressstores.Theyaremainlylocatedincitycentres
andonthehighstreetsofsmalltowns;TescoExpressstoresareneighbourhoodconvenience
shops,stockingmainlyfood;OneStopstoresaretheonlycategorywhichdoesnotincludethe
wordTescoinitsname.Thesearetheverysmalleststores.Inaddition,Tescohasabankingarm
calledTescoPersonalFinance;operatesasanISP,mobilephone,homephoneandVoIP
businesses;sellspetrolanddieselattheirownpetrolstations;andoffersaloyaltycardscheme
tocustomers.CustomerscancollectoneClubcardpointforevery1theyspendinaTesco
store,TescoPetrolorTesco.com.Tescohasoperatedontheinternetsince1994andwasthe
firstretailerintheworldtoofferarobusthomeshoppingservicein1996.Tesco.comwas
formallylaunchedin2000.
Incommonwithmostotherlargeretailers,Tescodrawsgoodsfromsuppliersintoregional
distributioncentres,forpreparationandonwarddeliverytostores.Tescoisextendingthis
logisticpracticetocovercollectionfromsuppliers(factorygatepricing)andtheinputto
suppliers,inadrivetoreducecostsandimprovereliability.Radiofrequencyidentification
(RFID)technologyistakinganincreasingroleinthedistributionprocess.
Tesco'sinternationalexpansionstrategyhasrespondedtotheneedtobesensitivetolocal
expectationsinothercountriesbyenteringintojointventureswithlocalpartners.Tesco
operatesinthefollowingmarkets:China,CzechRepublic,Hungary,India,Japan,Malaysia,
Poland,RepublicofIreland,Slovakia,SouthKorea,Thailand,Turkey,UK,andUSA.
ThebusinessisdependentonefficientInformationTechnology(IT)systems.Anysignificant
failureintheITprocessesoftheirretailoperations(e.g.barcodescanningorsupplychain
logistics)impactsabilitytotrade.TescorecognisetheessentialrolethatITplaysacrossthe
Groupinallowingefficienttradeandachievementofcommercialadvantagethrough
implementingITinnovationswhichimprovetheshoppingtripforcustomersandmakelife
easierforemployees.Thecompanyhasextensivecontrolsinplacetomaintaintheintegrityand
efficiencyofITinfrastructureandshareworldclasssystemsacrossInternationaloperationsto
ensureconsistencyofdelivery.

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Case media - Case study Dr Phil Kelly 2009

Pre class activities...

Ingroupsorindividually,researchTesco:itsstrategy,key
facts,operations;supplychain;productsandservicesand
infrastructureinordertogainahighlevelunderstandingof
thecompany.Youshouldbringyourresearchtoclassandbe
preparedtopresentordiscussyourfindings.

>60

First, if you are taking a taught management course then consult with your tutor and ensure that the case has not been scheduled into a teaching class or
tutorial. If it has not:
1. Play/ read the media associated with the case. You may need to access the Internet and enter a URL to locate any video clips.
2. Attempt the Case study questions.
Consider attempting the case study as a group exercise; you could form a study group with fellow students.
3. Check the suggested answers - remember these are suggestions only and there are often many possible answers.
Discuss questions and answers with other students.
4. If you feel your answer(s) were weak then consider reading the relevant suggested readings again (also see the case study suggested references).

Title/
Mediatype
Tesco CIO Colin Cobain

Film

URL/Mediadescription
http://videos.silicon.com/60416901.htm
Inthisexclusiveinterview(2007)Tesco'sgroupITDirector,ColinCobain,talksaboutthe
supermarketgiant'smovetostandardglobalsystemsandprocesses,revealsplanstocutIT
energyconsumptionandgivesanupdateontrialsofradiofrequencyIDtagstotrackgoods
throughthesupplychain.
AvarietyofIS/ITconceptsandthemesarediscussedinthevideo:Informationsystemsand
technologysupportingthecompanystrategy;deliveringbusinessbenefits,enablinge
commerce;makingthesupplychainmoreefficient;storingdata;managingtheITteamand
usingsystemsinaresponsibleway.

NOTES:

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Case media - Case study Dr Phil Kelly 2009

Casestudyquestions...
Pre/During/After
class

Action

TESCO - WHAT KIND OF BUSINESS IS IT AND WHY IS IT PERFORMING SO WELL?

TESCO: USE OF IT AND INFORMATION SYSTEMS

CHALLENGES

SYSTEM USERS

MIS

IS/ MIS PURPOSE

EVALUATE TESCO'S' SYSTEMS

During

TESCO - what kind of business is it and why is it performing so well?

During

In groups, brainstorm as many examples of how IT and IS may be used to help the company operate and
achieve its objectives.

During

Discuss the challenges faced by the CIO - which are the most important and why?

During

Identify the users of TESCO IS and IT - prepare a table with the first column showing the technology or system
used and then create a column for each stakeholder and indicate whether a stakeholder uses a particular
system/ technology by placing a tick in the relevant part of the table

During

What is an MIS? You should define MIS and discuss the component parts.
Use the five component framework to describe/ better understand a selection of systems identified earlier.

During

Summarise the main purposes of information systems in organizations

During

Which of Tesco's systems are most likely to confer a competitive advantage for the company?

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Case media - Case study Dr Phil Kelly 2009