Tesco Supermarket - Case Study Example

Tesco Supermarket Introduction Tesco is the United Kingdom’s most successful retail organization (Little, . Tesco represents a team of more than 500,000 people who work in 12 markets (Tesco, 2014). And Tesco has vision and mission in which clear direction, high-quality assets and opportunities for future growth have been provided in the vision statement whereas customer services, price, and value, brand and marketing are some of the important elements in its mission statement (Tesco, 2014). Report Objectives This report has following objectives. First, the report highlights the organizational culture of Tesco in which its current organizational culture and practices have been provided and discussed. Second, the report also takes into account the concept of motivation and current level of motivation in the employees of Tesco. Third, the report also recommends methods to improve the productivity of employees. Justification Currently, Tesco is not operationally performing better. Some reports indicate that the senior management has the unclear policy towards the employees and employee performance and productivity. On the other hand, some reports highlight that Tesco's organizational culture enables employees to improve their operational performance and productivity. These points are contradictory in their very nature. Under such circumstances, it is highly important to assess Tesco and highlight its performance relating to its employees’ motivation and organizational culture. Analysis Organizational Culture Organizational culture is the highly important aspect of today's corporate life. Culture is defined as a set of assumptions, beliefs, customs, traditions and other personal, social and organizational methods that are owned and practiced by a group of life (Teegarden et al., 2011). This definition clearly mentions two important aspects: beliefs and group. For a culture to exist and perform the function, it is highly essential that it must have both these elements without their existence, a culture will not exist and nor will be able to perform. Based on this definition, organizational culture can be defined as “the way things are done in an organization” (Karwowski, 2006.p. 2204; Cameron and Quinn, 2006). In simple words, organizational culture reflects that how employees think, carry out their actions and make decisions within an organization (Karwowski, 2006). In this regard, it is also important to highlight that every organization has its different culture which is always unique and because of this uniqueness, each organization is culturally different and unique as well (Karwowski, 2006). On the other hand, organizational culture has also been identified as diverse and complex because numerous and range of behaviors, attitudes, and activities are being carried out simultaneously (Vavrusa, 2008). Before going to highlight Tesco supermarket’s organizational culture, it is highly essential to mention that organizational culture has different dimensions for Tesco customers and Tesco employees. In other words, Tesco employees’ interaction and service to Tesco customers are the central aspects which determine the type and level of organizational culture operational inside the Tesco supermarket. It has been mentioned that Tesco senior management treats professionally (respect and trust for Tesco employees) to Tesco employees and who subsequently look after and professionally entertain Tesco customers (Our Culture, 2009). In this simple statement, overall Tesco's organizational culture is clearly demonstrated as it highlights the Tesco's philosophy and approaches towards the organizational culture. For employees, Tesco's senior management has the separate organizational attitude. In the initial part of the above paragraph, it is evidently visible that the Tesco's senior management is not directly talking about the customers, who are the real recipients of their professional organizational attitude, but they more support to their employees. This support is mainly caused by the fact that it is the role of Tesco's employees to entertain the customers who daily visit the Tesco's supermarket and stores. In this regard, it is important to signify that Tesco’s senior management (including group personnel director, information technology directors and so on), does not directly cater or provide services to Tesco customers but it is the role of lower management (including store manager, customer assistant, team leader and so on) to assist Tesco customers and perform their role. In this situation, the Tesco’s senior management has put in place strong organizational values that are of central importance to the organizational culture: trust and respect. Both these values have been mentioned in the preceding paragraph in which Tesco’s lower or operational staff has been trusted by the senior management and this trust is demonstrated through assigning certain organizational responsibilities and subsequently, they (the senior management) expects that the employees will fulfill their organizational responsibilities while discharging their duties and services. Subsequently, employees receive friendly and professional attitude and behavior from the senior management of Tesco and consequently they provide the same positive and professional attitude and behaviour to the customers. In other words, it is like a situation in which values, such as respect and care, are given to Tesco employees and in return they professionally look after the Tesco customers. Organizational culture considerably affects employee performance and employee management. For example, Alison, who is a Group Personnel Director at Tesco, explains that she has been very clearer about the work requirements and expectations from the top senior management and through clarity they are better connected to the group and with other department members (Alison, 2009). This testimonial of Alison highlights a link between organizational culture and employee performance and management as well. currently, the top senior management and department heads of Tesco have developed an environment in which the lower and operational employees are not confused about their nature of work and nor are they worried about any hard or strong behavior from the top management but they are crystal clear about their duties and services. And it is the impact of this clarity that enables them and provide them confidence that they can work better and work with other in a close coordination. Motivation Motivation is a key to organizational success. The word motivation comes from the Latin word ‘movere’, meaning “to move” (Anshel, 2006; Mills et al., 2007). It is defined as a tendency to move in the certain direction with an aim of achieving its intended direction; and there are two types of motivation: intrinsic motivation and extrinsic motivation (Brehm, 2014; Lin, 2008; Shah and Gardner, 2008). The intrinsic motivation refers to that type of motivation that is internally generated in which satisfaction, achievement, enjoyment are certain aspects that are expected and satisfied as well while the extrinsic motivation is reflected when the external rewards, such as money, good marks, cars and other perks and bonuses are achieved (Brehm, 2014). In other words, the distinction between intrinsic and extrinsic motivation is purely made by tangible and intangible aspects. For example, recognition, which is a form of intrinsic motivation, represents intangible perspective as it is not possible to see recognition in any concrete shape or format but it reflects a feeling in which the recognized person feels the sense of satisfaction. As a result, it is termed as a form of intrinsic motivation. On the other hand, extrinsic motivation is tangible and easily observable and touchable as well. For example, money received in the shape of salary is tangible. Thereby, it can be easily touchable by any. However, both types of motivation are not expected by everyone. Some employees prefer recognition, achievement, and satisfaction while others expect rewards in the shape of cars, allowances, bonuses and so on. Based on this assessment, Tesco supermarket offers both intrinsic and extrinsic motivational rewards to its employees. For example, Tesco rewards annual bonus, share incentives and colleagues as shareholders (Tesco Reward, 2013). In the annual bonus structure, which is a form of extrinsic motivation, Tesco assesses the group performance in which profit growth, strategic financial and non-financial parameters are taken into account; for the share incentives, around 5,000 management team involve in the Performance Share Plan (PSP) scheme and winners are rewarded shares after the deferment of two or three year period; for colleagues as shareholders, the employees are encouraged to participate in this activity and currently more than 125 million shares are owned by employees under the structure of Share Incentive Plan and Save As You Earn Scheme is available for 140 million options for the employees (Tesco Reward, 2013). A closer analysis of the above-mentioned rewards reflects that Tesco only uses extrinsic motivation for improving the productivity of employees. In all options, employees are expected to receive such offers if they meet the certain criterion in which their actual performance meets certain benchmarks. If these benchmarks are not met, the employees would not be able to receive above-mentioned incentives and rewards in the shape of bonuses, shares and share options. In other words, the senior management of Tesco is not focusing on the use of intrinsic motivating factors which are highly and immensely important for enhancing the productivity of employees. As a result, the employees will not be able to improve their individual productivity and increase their overall organizational performance. Within this context, Rawlinson (2013) mentions that Tesco workers are forced to wear electronic armbands that are used for grading their organizational achievement and performance against set standards of assessment. The use of such devices is completely new and strange as well. This device is less useful for measuring performance but is more utilized to monitor the presence and activities of employees (Rawlinson, 2013). Based on this result, it can be deduced that the senior management of Tesco is not trusting the employees instead they are watching them and keeping eye on them. Under this situation, it will be very difficult for the employees to increase their productivity and improve their performance in a required professional manner because for generating superior organizational performance, it is highly essential that the employees should feel the sense of ownership and an integral part of the organization. In the absence of such attachment, it would be nearly impossible for them to improve productivity and even to meet the basic benchmarks of assessment and performance. In this regard, Lorna Bryson, who is the head of Apprenticeship and A-Level Schemes, mentions that Tesco’s young workers are least motivated (Peacock, 2008). This example is clearly reflecting that the senior management of Tesco is not addressing the real problem relating to employee motivation but is more relying on the use of extrinsic motivation. As a result, Tesco has recorded financial loss for the first time in 20 years (Curtis, 2012). Overall, Tesco's employees face the death of intrinsic motivation. This deficiency is clearly causing many issues, including employee performance and employee management as well. In order to reduce the impact of least motivation, the senior management of Tesco should contemplate and take some serious steps for improving the employee productivity and organizational performance as well. For example, more concentration should be focused on the real issues, such as intrinsic motivation in which separate programs should be launched and they must be only aiming at enhancing the core competencies and motivation tendency for upgrading and improving their organizational performance through training and development programs. Conclusion Tesco’s organizational culture is employee oriented. The senior Tesco management attaches considerable significance to values which are central to the organizational culture. For example, trust and respect are two values that are being availed by the employees of Tesco. Through this behavior, the senior management is trying to reach customers and expect that operational staff should provide high-quality services to customers. In this regard, Alison has clearly mentioned that the provided organizational culture enables them to see things clearly and work with other employees through strong and active coordination. On the other hand, employees are least motivated and only extrinsic motivation is pursued through bonuses, shares and share options schemes for the current and potential employees. At the same time, Tesco requires that the employees should wear armbands for assessing their performance and productivity. However, these measures do not enable the employees to feel the sense of ownership. Instead of using and relying on the support of extrinsic motivation, the senior management should focus on the utilization of extrinsic motivation in which training and development sessions should be pursued as a way to improve their productivity and performance as well. References Alison, (2009). Tesco Careers. Tesco Supermarket. Available: http://www.tesco-careers.com/home/people/alison-horner . Accessed: 20 August, 2014 Anshel, M.H. (2006). Applied Exercise Psychology: A Practitioner’s Guide to Improving Client Health and Fitness. New York: Springer. Brehm, B.A. (2014). Psychology of Health and Fitness. Philadelphia: F.A. Davis Company Cameron, K.S., & Quinn, R.E. (2006). Diagnosing and Changing Organizational Culture: Based on the Competing Values Framework. California: John Wiley. Curtis, P. (2012). Why are we failing out of love with Tesco? The Guardian. Available: http://www.theguardian.com/politics/reality-check-with-polly-curtis/2012/apr/18/tesco-retail Accessed: 20 August, 2014 Karwowski, W. (Ed.). (2006). International Encyclopedia of Ergonomics and Human Factors. Florida: CRC Press. Little, N. (2012). Tesco’s CEO Phillip Clarke pledges to become a more engaging leader. HR Magazine. Available: http://www.hrmagazine.co.uk/hro/features/1020980/tesco-s-ceo-philip-clarke-pledges-engaging-leader Accessed: 20 August, 2014 Lin, C. (2008). Gender Differences in Spectator’s Motivation for Taiwanese Men’s Basketball. Miami: ProQuest Mills, J.H., Mills, A.J., Orshaw, C., & Bratton, J. (2007). Organizational Behavior in a Global Context. Toronto: University of Toronto Press. Our Culture, (2014). Tesco Careers. Tesco Supermarket. Available: http://www.tesco-careers.com/home/working/our-culture Accessed: 20 August, 2014 Peacock, L. (2008). Tesco failing to motivate its young workers. Personnel Today. Available: http://www.personneltoday.com/hr/tesco-failing-to-motivate-its-young-workers/ Accessed: 20 August, 2014 Rawlinson, K. (2013). Tesco accused of using electronic armbands to monitor its staff. The Independent. Available: http://www.independent.co.uk/news/business/news/tesco-accused-of-using-electronic-armbands-to-monitor-its-staff-8493952.html Accessed: 20 August, 2014 Shah, J.Y. & Gardner, W.L. (Eds.). (2008). Handbook of Motivation Science. New York: The Guilford Press. Teegarden, P.H., Hinden, D.R.,& Strum, P. (2011). The Non-profit Organizational Culture Guide: Revealing the Hidden Truths That Impact Performance. California: John Wiley. Tesco Reward, (2013). Our Approach to Reward. Tesco. Available: http://www.tescoplc.com/assets/files/cms/Resources/Rewards_and_benefits_09052013.pdf Accessed: 20 August, 2014 Tesco, (2014). About Us. Tesco. Available: http://www.tescoplc.com/index.asp?pageid=6 Accessed: 20 August, 2014 Vavrusa, V.A. (2008). Principles of Culture, Language, and Literacy in Relation to Organizational Leadership Discourse. Miami: ProQuest. Read More