INFORMATION SYSTEM OF

TESCO

Reg Number : EU/IS/2012/COM/79Index Number: COM 1579Management Information System,MGT 2063.

Introduction Tesco Plc.Tesco Plc.

About Tesco

Company Profile

Mission Statement Of Tesco

Vision Statement Of Tesco

INTRODUCTION TESCO ABOUT

• Tesco is a global grocery and general merchandise retailer headquartered in Chesnutt, United Kingdom.• It is the third-largest retailer in the world measured by revenues (after

Wal-Mart and Carrefour) and the second-largest measured by profits (after Wal-Mart).• It has stores in 14 countries across Asia, Europe and North America and is

the grocery market leader in the UK (where it has a market share of around 30%),Malaysia, the Republic of Ireland and Thailand

• Originally specialising in food and drink, it has diversified into areas such as clothing, electronics, financial services, telecoms, home, healthcare, dental and pet insurance, retailing and renting DVDs, CDs, music downloads, Internet services and software.• Tesco also operates a grocery home-shopping service, as well as

providing consumer goods, telecommunications and financial services online.

• COMPANY PROFILE

Mission Statement Of Tesco:“Creating value for customers, to earn their lifetime loyalty.”

Vision Statement Of Tesco:“Our vision is for Tesco to be most highly valued by the customers we serve, the communities in which we operate, our loyal and committed staff and our shareholders; to be a growth company; a modern and innovative company and winning locally, applying our skills globally.”

CHAPTER 01

INFORMATION SYSTEM IN GLOBLE

TODAY

Information System Of Tesco In Global TodayAbout Information system of Tesco:

IntroductionGeneral Purpose Vs. Specialized Information SystemsTypical Components Of Information SystemsDifferent TypesHow Tesco use Information Systems to their advantage.

Information System Of Tesco In Global Today

About Information system of Tesco:IntroductionMany organizations work with large amounts of data. Data are basic values or facts and are organized in a database. Many people think of data as synonymous with information; however, information actually consists of data that has been organized to help answers questions and to solve problems. An information system is defined as the software that helps organize and analyse data. So, the purpose of an information system is to turn raw data into useful information that can be used for decision making in an organization.

General Purpose Vs. Specialized Information Systems

There are some general types of information systems. For example, a database management system (DBMS) is a combination of software and data that makes it possible to organize and analyse data. DBMS software is typically not designed to work with a specific organization or a specific type of analysis. Rather, it is a general-purpose information system. Another example is an electronic spreadsheet. This is a tool for basic data analysis based on formulas that define relationships among the data. For example, you can use a spreadsheet to calculate averages for a set of values or to plot the trend of a value over time.

Typical Components Of Information Systems

While information systems may differ in how they are used within an organization, they typically contain the following components:

01. Hardware. Computer-based information systems use computer hardware, such as processors, monitors, keyboard, and printers.

02. Software. These are the programs used to organize, process and analyse data.03. Databases. Information systems work with data, organized into tables and files.

04. Network. Different elements need to be connected to each other, especially if many different people in an organization use the same information system.

05. Procedures. These describe how specific data are processed and analysed in order to get the answers for which the information system is designed.

The first four components are part of the general information technology (IT) of an organization. The procedures are very specific to the information needed to answer a specific question.

Different TypesThe many different types of information system can be divided into categories based on the where they are used in the hierarchy of an organization. This is illustrated in the figure below.

How Tesco use Information Systems to their advantage.

“Information systems have played a key role in helping Tesco deliver strong profits.”Tesco was found by Jack Cohen, he began to sell groceries from a stall in the East End of London. On his first day profit was £1. Today, Tesco is one of the world’s largest supermarket retailers in the world. In Tesco the managers use essential Information systems tools for managing, assessing and efficiently running their departments. This information provides them with past, present and future material. Tesco use this information system to find out monthly statements of expenses which helps managers in making decisions.

The system is also used to find out how many hours the employees have worked over a period of time. Managers use information Systems to help them understand their customers more which in return assists them in pricing analysis and loyalty schemes. Since its launch in 1997, Tesco Club card has over 700,000 members in Ireland. Tesco customers have received over €200m in vouchers.

For Tesco to easily handle sales of products, merchandise, buying dealings, stock optimisation and price policy; they installed and implemented the information system of G.O.L.D in 1998. The purpose of G.O.L.D is to manage the physical stock flows of the warehouses. The information system G.O.L.D is helping managers working in warehouse to control the stock levels, the quality of goods, location of stock and the functions of warehouse.Also Tesco have used another Information systems such as the Internet to their advantage. It is also beneficial for customers because it gives them flexibility to access their website whenever they feel the need. Tesco.com was formally launched in 2000 even though it has operated on the Internet since 1994. In 2012 Tesco reported that their Irish online grocery shopping grow strongly with sales up by 21% to €57.1million.

Below is a video link of how Tesco have used their Innovations to create amazing new information systems.http://www.tescoplc.com/index.asp?pageid=187&mediaid=505&slide=5

To conclude this is the age of information system and is a key of success. Tesco is achieving goals, competing with their competitor and making profit through smart information system. Therefore information system play a vital role in how Tesco day by day business while achieving big goals.

Why Need Information System For Tesco

Business Perspective On Information Systems Of Tesco:• Information system is instrument for creating value for Tesco.• Investment in information technology will result superior

returns:Productivity increases.Revenue increases.Superior long-term strategic positioning.

Dimensions Of Information System Of Tesco

There are three main dimensions of information system of TESCO. those are;

Organizations DimensionTechnology DimensionManagement Dimension

Contemporary Approaches to Information Systems

• The Technical Approach;emphasizes mathematically based, normative models to study information systems, as well as the physical technology and formal capabilities of these systems. • The Behavioural Approach;a growing part of the information systems field, does not ignore technology, but tends to focus on non-technical solutions concentrating instead on changes in attitudes, management and organizational policy, and behavior.

CHAPTER 02

GLOBLE E-BUSINESS AND

COLLABORATION

Functional Business Processes Of Tesco• Customer Service• Finance• Research & Development• ICT• Administration• Human Resources• Marketing• Distribution• production

• Sales• Finance

Tesco's international expansion strategy has responded to the need to be sensitive to local expectations in other countries by entering into joint ventures with local partners. Tesco operates in the following markets: China, Czech Republic, Hungary, India, Japan, Malaysia, Poland, Republic of Ireland, Slovakia, South Korea, Thailand, Turkey, UK, and USA. The business is dependent on efficient Information Technology (IT) systems. Any significant failure in the IT processes of their retail operations (e.g. barcode scanning or supply chain logistics) impacts ability to trade. Tesco recognise the essential role that IT plays across the Group in allowing efficient trade and achievement of commercial advantage through implementing IT innovations which improve the shopping trip for customers and make life easier for employees. The company has extensive controls in place to maintain the integrity and efficiency of IT infrastructure and share world class systems ‐across International operations to ensure consistency of delivery.

Information Technology Enhances Business Processes By:

• Increasing efficiency of existing processes• Automating steps that were manual

• Enabling entirely new processes • Change flow of information• Replace sequential steps with parallel steps• Eliminate delays in decision making• Support new business models

Types of business information system of TescoThe many different types of information system can be divided into categories based on the where they are used in the hierarchy of an organization. This is illustrated in the figure below.

A non-exhaustive list may include: RFID systems , CCTV surveillance; order-processing systems, scheduling systems, hand-held devices , Financials, HR software; communications technology to connect stores; e-commerce and e-business systems; supply chain systems, information systems (IS) used in Tesco to support their loyalty card, car insurance policy quoting system, Tesco has used electronic data interchange with its major suppliers, chip and PIN system, Tesco Personal Finance (TPF) for loan application handling, food labelling system , workforce scheduling system; computer systems are used in a variety of ways in the modern, large supermarket, from stock control to maintaining temperatures in fridges and freezers; computers are used to control the stock and are connected to the checkouts, Located at each checkout is an ELECTRONIC POINT OF SALE ( EPOS ) till.

This EPOS till comprises a keyboard, a digital display, a scanner which reads bar codes, a set of scales, a printer, a credit / debit card reader and a till drawer. Each till also has its own base to which all of the above is attached. It is the base unit which is connected by cables to the branch computer in the supermarket's system office. A branch computer sends the details of every individual sale to the main computer at the Head Office. Stores are also big users of email. The company also uses computers for staff recruitment. Potential applicants complete an application form over the Internet which is vetted by Head Office. Other systems include Pay@Pump petrol system; CRM etc.

Online Business Model Of Tesco

E Commerce - TescoBusiness 2 Business Model;Is Refers to the full range of e-commerce that can occur between two organizations. Among other activities B2B e-commerce including purchasing and procurement, supplier management, inventory management, channel management, sales activities, payment management, and supports. Tesco is a pioneer in Grocery Shopping & Delivery Service commerce. Now Tesco extends this functionality all the way to organization's Enterprises Resource Planning system for true B2B commerce.

Business 2 Consumers Model;When conducting business over the Internet, there are several different transactions or business models that exist within the world of E-Business. One of the most common models in E-Commerce is the Business-To-Consumer (B2C) model. In B2C transactions, online transactions are made between businesses and individual consumers. Businesses sell products and services through electronic channels directly to the consumer.B2C E-Commerce involves what is known as electronic retailing or e-tailing. E-tailing involves online retail sales. E-tailing makes it easier for a manufacturer to sell directly to a customer, cutting out the need for an intermediary. With B2C transactions there is no need for retailers and therefore, no need for a physical store from which to distribute products.

Collaboration Vision And Framework Of TescoWith Intra 2.0 under development, Tesco needed to prioritize and scale its use of the new collaboration tools. IBSG identified four core business areas that could benefit most from Web 2.0 capabilities: trade planning, space range and display (SRD), innovation, and promotions. The tesco team then ran a series of workshops with Tesco employees from each of these areas to look for opportunities to generate business value through the use of collaboration tools. The end goal was to embed collaboration tools in specific business processes, without reengineering the Tesco operating model, and to make the tools easy for people to use.

The workshops showed that opportunities for using collaboration could best be grouped under four processes: innovation, decision making, knowledge sharing, and operational excellence. tesco built a framework with workflow templates for each business area, incorporating the appropriate collaborative tools and mapping them to the four processes. In this collaboration framework, innovation is a self-contained entity because it is both a core business area and one of the predefined processes. Trade planning and SRD fit into the knowledge sharing process, while promotions are linked to decision making and operational excellence.The aim in the innovation area, for example, is to provide a forum for open discussion of ideas, leading to selection and development of the strongest suggestions.

Using a customized version of Intra 2, Tesco employees will be able to post, discuss, and track the progress of ideas for innovation. A steering group will then use collaboration tools such as tesco TelePresence and tesco WebEx to select and develop the ideas with the most potential. The templates for knowledge sharing, decision making, and operational excellence are similar to the innovation approach and incorporate the same collaboration tools. Tesco decided to begin its deployment of Intra 2.0 by rolling out the knowledge-sharing and innovation elements of the collaboration framework because these elements were most likely to deliver business benefits within a short timeframe.

Exploring Collaborative OptionsA project team then developed three Web 2.0-type collaboration tools—a discussion forum, blogs, and a wiki—using freeware, and set up a pilot for teams in IT, IOD, and HSC. The objectives of the three-month pilot were to see how many people would use the tools and what value they could bring to the business. Discussion forums and blogs emerged as the tools that people liked and wanted to use; during the pilot, for example, 520 people took part in discussion forums on 78 topics. On the basis of the outcomes of the survey and pilot, Tesco executives approved the development of Intra 2.0, a new version of the company’s intranet. Intra 2.0 is based on a Web 2.0 platform and incorporates a wide range of functions—from discussion forums and blogs to a directory, presence, and customization.

Challenges of Using Business Information Systems for Tesco

Standardisation and integration (Tesco's global standardisation strategy began five years ago) - paves way for global expansion; Tesco plans to centralise IT applications across its stores worldwide. Tesco plans to centralise its Oracle Financials software, used for invoicing, its PeopleSoft HR software, and Terradata Management Information Systems, used for measuring budgeting targets. Maintaining the confidentiality, integrity and availability of systems and data Ensuring systems are used ethically and responsibly Ensuring the systems strategy is aligned with the corporate and other business strategies Recruiting and maintaining the IT/IS team and systems Aligning systems with processes Managing systems in a cost effective manner

CHAPTER 03

INFORMATION SYSTEMS, ORGANISATIONS AND

STRATEGY

Tesco plc Organization Tesco PLC is a Britishmultinational grocery and general merchandise retailer headquartered in Welwyn Garden City, Hertfordshire, England, United Kingdom.It is the third largest retailer in the world measured by profits and second-largest retailer in the world measured by revenues. It has stores in 12 countries across Asia andEurope and is the grocery market leader in the UK (where it has a market share of around 28.4%), Ireland, Hungary,Malaysia, and Thailand.Tesco was founded in 1919 byJack Cohen as a group of market stalls. The Tesco name first appeared in 1924, after Cohen purchased a shipment of tea from T. E. Stockwell and combined those initials with the first two letters of his surname, and the first Tesco store opened in 1929 inBurnt Oak, Barnet.

Organizational Chart - Tesco

Organisation's Framework of Tesco

Key Organizational Features Of Tesco

How Information Systems Impact Organizations and

Business FirmsFrom an economic point of view, information systems technology can be seen as a factor of production that can be freely substituted for capital and labour. As information systems technology automates the production process, less capital and labour are required to produce a specified output.Transaction cost theory; states that organizations grow in size because they can obtain certain products or services internally at lower cost than by using external firms in the marketplace. By lowering the cost of market participation (transaction costs) information technology allows firms to obtain goods and services more cheaply from outside sources than through internal means. Information systems can thus help firms increase revenue while shrinking in size.

Firms traditionally grew in size to reduce transaction costs. IT potentially reduces the costs for a given size, shifting the transaction cost curve inward, opening up the possibility of revenue growth without increasing size, or even revenue growth accompanied by shrinking size.

Agency theory;views the firm as a nexus of contracts among self- interested individuals, who must be carefully supervised to ensure they pursue the interests of the organization. Information technology can help reduce agency costs, the costs of coordinating many different people and activities, so that each manager can oversee a larger number of employees.

The Internet And TescoInternet Operations Of Tesco;

01.Tesco operates a grocery home shopping service, as well as providing consumer goods, telecommunications and financial services online.02.Tesco has operated on the internet since 1994 and was the first retailer in the world to offer a robust home shopping service in 1996.03.Tesco offers an internet-based DVD rental service, which is operated by LOVE-FiLM and a music download service.

U.K. Operations (stores);

• Tesco's UK stores are divided into six formats, differentiated by size and the range of products sold.

Tesco ExtraTesco SuperstoresTesco MetroTesco ExpressOne-stopTesco Homeplus

Using Information Systems To Achieve Their Competitive

AdvantageThe central computer system will contain information on the margin and relative profitability of every item.

Making decisions concerning which products to boost and promote and which ones drop.

Speed up the warehouse efficiency and to reduce the costs of distributing the products.

Used to minimize duplication. The fewer times that actual deliveries and the support documentation need to be checked, the speedier and cheaper in the system.

Support Activities• The activities that the organization performs to assist the primary

activities to gain the competitive advantage.

Procurement - Supply Chain Management(EPOS, EDI, Pre-planning with suppliers, Decision Support System, Streamlined Distribution)

Technology Development - Centralized Automated Information Management System

Human resource management - Structured process for recruitment and Selection

Infrastructure - Collaborative work systems(Stronger cash flow and improved profit for all parties)

Porter’s Competitive Forces Model

Porter’s Competitive Forces Model For Tesco

Rivalry Among

Competitors(High)

Threat of New

Entrants(Medium)

Bargaining Power

of Buyers(Medium)

Threat of Substitute Products

(Low)

Bargaining Power

Of Suppliers(Low)

Porter’s Competitive Forces Model For Tesco

Threats Of New Entrants• Competitive Rivalry is considered a high threat and are people like

Amazon and Asda including other supermarkets and non-food retailers who are involved in the same concept. IF consumers see little difference between the product and that of the competition then they will tend to choose on price.

Bargaining Power of Suppliers• There is little threat as often large supermarkets dictate the price

they pay to the supplier. If the supplier does not agree to Tesco’s price then the supplier will be left with no retailer.

Threats of New Entrants• Tesco, Asda, Sainsbury and other supermarket chains put up

considerable barriers to entry. Anyone starting up a new supermarket chain has barriers imposed on them, implicitly or explicitly, by the existing supermarkets.

Bargaining Power of Buyer• Buyer power also acts to force prices down. If beans are too

expensive in Tesco, buyers will exercise their power and move to Sainsbury. Tesco including other supermarkets have a disciplined approach to prices setting. This approach stops them from destroying each other in a profit war.

Threat of Substitute Products• Tesco competition from other supermarkets which can provide

substitute goods drives the prices of both companies down; therefore substitute is seen as a Low threat.

Porters Value Chain Model – Analysis With Tesco

Porters Value Chain Model – Analysis With Tesco

01.Inbound Logistics;

• Inbound logistics is an integral element of business operations for a manufacturing firm, involving the processes of receiving, storing and disseminating incoming goods or material for use.

EPOS• Inspect the goods on shelves & bar code scanning using portable

data-capture machines used for checking shelf stock levels and send the data to centralized system.• Based on centralized system figures monitoring warehouse efficiency,

space and utilization.

EDI• Receive the supplier delivery note and sending the promissory note

via EDI.• Electronic payment and funds transferring.• Delivery times planning through route linking.

02.Operations;• Operations transform resource or data inputs into desired goods,

services, or results, and create and deliver value to the customers.Suppliers have systematically joined Tesco’s network

(‘community’)Provide knowledge of EDI for suppliers by seminarsEDI is not just for PO releasing and invoices, but to broadcast

forecast information.Up-to-date product information'sFaster movement of information and shorter supply timesHandling large number of suppliers through the network Effective operation by efficient procurement and customer

services

03.Sales & Marketing;• Attracting potential customers to enhance business or activity of

selling goods or servicesEfficient Customer Response (ECR)Likelihood of stock-outs and the consequent loss of sales is

minimized.Sales & cash flow monitoring via systemLoyalty programs through IT discourage the customers from brand

switchingBased on sales patterns through system make sure product

availability with competitive pricesBased on system data statistics planning seasonal offers.

04.Services;• All the activities required to keep the product / service working

effectively for the buyer after it is sold and delivered. It enhance the product’s value.Introduction of virtual super markets by using IT infrastructure is

another competitive advantage.Having support desk to facilitate customer care and services.Club card records a customer purchases and award a credit for

use with future purchases.

05.Outbound Logistics;• Required to transfer the finished products to the customers via

warehousing, order fulfilment, transportation, and distribution management.

The company has developed four convenience store formats.- Superstores- Compact stores- Metros- Express stores

EDI has developed in parallel with composite, multi temperature food warehouses and trucks.

EPOS extract updated information from centralized systems. e.g.. transmit orders via Tradanet, evaluate profitability.

• EPOS reduce the cost of all outbound operations e.g.. lower cost to suppliers and company.• EPOS has developed to predict demand patterns for individual stores.

CHAPTER 04

ELECTRONIC COMMERCE: DIGITAL

MARKETS, DIGITAL GOODS

Electronic Commerce And TescoTesco is going global with e-commerce;• The retailer discusses its recent project to sell online in more

countries. With 6,234 stores in 13 countries and annual sales of 72 billion pounds ($116 billion), U.K. retailer Tesco is well established in the global marketplace. But until recently the supermarket chain operator only sold to consumers on the web in its home market of the U.K.• Tesco, No. 3 in the Internet Retailer Top 400 Europe, took its first step

into selling goods electronically in 1984 with a service that enabled registered members to buy a limited range of products via a television interface, Sam Hill, lead solution architect at Tesco Plc., told attendees at the e-Commerce Expo in London this week.

• That small service, which had just 450 users, has now grown into a booming e-commerce business. Tesco's U.K. online sales totaled around 2 billion pounds ($3.2 billion) for its fiscal year ended April 5, 2012. And, the web is only growing for Tesco. Its U.K. web sales rose 11% in the first six months of this year.• Tesco has invested heavily in e-commerce, offering a mobile app and

site for the U.K. and a service in 70 stores across Britain that allows customers to order online from a PC or mobile device and collect their groceries in store. And now it’s set its web sales sights on countries beyond the U.K. In September 2010, the retailer outlined an aggressive plan to roll out web ordering and delivery in major cities in the Czech Republic (Prague) in January 2012, several urban centers in Poland in July and Slovakia (Bratislava) in October, with plans to further expand into China, India, Malaysia, South Korea, Thailand, Hungary, Republic of Ireland, Turkey and the United States in the near future. So far it is on target with its plans.

• Rather than build a separate e-commerce platform for each country, Tesco decided to build a template that could be used for all international sites, Hill says. It built the platform in-house using a team of 100 in the U.K. and India.• For the new platform to work across borders, the designers had to

overcome many challenges, Hill says.• For example, each region has different regulations for how it can store

and use consumer data, Hill says. In some countries, e-retailers are required to encrypt all customer data. In others they have to disclose to consumers details about how they will use and store data. Tesco had to develop a platform that could accommodate the laws for each region.

Electronic Commerce And Tesco

E - Commerce And Internet

Key Concepts in E-commerce: Digital Markets and Digital Goods In a Global Marketplace

•Digital markets reduce• Information asymmetry• Search costs• Transaction costs• Menu costs

•Digital markets enable• Price discrimination• Dynamic pricing• Disintermediation

Types of E – Commerce of Tesco

Types of E – Commerce of TescoBusiness 2 Business Model;Is Refers to the full range of e-commerce that can occur between two organizations. Among other activities B2B e-commerce including purchasing and procurement, supplier management, inventory management, channel management, sales activities, payment management, and supports. Tesco is a pioneer in Grocery Shopping & Delivery Service commerce. Now Tesco extends this functionality all the way to organization's Enterprises Resource Planning system for true B2B commerce.

Business 2 Consumers Model;When conducting business over the Internet, there are several different transactions or business models that exist within the world of E-Business. One of the most common models in E-Commerce is the Business-To-Consumer (B2C) model. In B2C transactions, online transactions are made between businesses and individual consumers. Businesses sell products and services through electronic channels directly to the consumer.B2C E-Commerce involves what is known as electronic retailing or e-tailing. E-tailing involves online retail sales. E-tailing makes it easier for a manufacturer to sell directly to a customer, cutting out the need for an intermediary. With B2C transactions there is no need for retailers and therefore, no need for a physical store from which to distribute products.

• Business 2 Government Model:On the Internet, B2G is business-to-government (a variation of the term B2B or business-to-business), the concept that businesses and government agencies can use central Web sites to exchange information and do business with each other more efficiently than they usually can off the Web.

• Customer 2 Customer model:Sometimes known as Consumer to Consumer, E-Commerce involves electronically-facilitated transactions between individuals, often through a third party.

• M – Commerce:• Tesco, a multinational retailer of groceries and general merchandise,

has announced trials of a mobile payment service for customers via the PayQwiq service.• Trials are occurring in a small number of stores in London and

Edinburgh, and are currently only available to staff members. Tesco claims that initial responses are positive, and hopes for the mobile payments to continue bolstering its shopping experience for customers.

The Mobile Digital Platform And Mobile E-commerce of Tesco

M-commerce Services And Applications Classification

One way to classify m-Commerce services and applications is based on the functionality they provide to the mobile users. This kind of classification results in two major classes: the directory and the transaction oriented services and applications. The major categorization between these two classes of services is that in the former a mobile user performs only read requests to the directory, whereas in the latter a user performs read and write requests to the transaction server. It is necessary to note that an m-Commerce application can be a combination of both classes.

The Directory Class The Transaction Oriented Class

• The Directory Class:• The directory-oriented class of m-Commerce services comprises

applications that provide information to mobile users. This information can be location, content and user dependent, being localized and personalized in ways appropriate to the specific mobile user. For example, a mobile user, being away from home, needs up-to-date information regarding his current location, and local facilities that he can use. Note that directory-oriented m-Commerce services can be offered via broadcast.

• The Transaction Oriented Class:• The transaction-oriented class comprises various services and

applications with which the mobile user conducts transactions with the service provider. The transactions contain read and write operations on behalf of the mobile user. For example, a banking service for mobile users falls into the transactionoriented class of m-Commerce services.

CHAPTER 05

IT INFRASTRUCTURE AND EMARGING TECHNOLOGIES

IT Infrastructure• The term IT infrastructure is defined in ITIL v3 as a combined set of

hardware, software, networks, facilities, etc. ( including all of the information technology), in order to develop, test, deliver, monitor, control or support IT services.

IT Infrastructure of Tesco• Tesco will run a private cloud infrastructure from its internal

datacentre to host its website and retail related apps• Tesco will adopt private cloud infrastructure to host its website and

retail related applications by mid-2013.The private cloud will be hosted within its own internal datacentres which are “cloud-ready” after the retailer’s virtualisation and datacentre consolidation projects last year.

• Verizon today announced it is working with Tesco to migrate the retail giant to a single global network infrastructure that will underpin its ongoing application and infrastructure centralisation programme. • Verizon is providing secure connectivity to link Tesco’s suppliers,

partners, customers and colleagues in 12 countries around the globe, it revealed.• The new network infrastructure also offers a solid foundation from

which Tesco can deliver key business applications consistently to all stakeholders, the company added. This will enable Tesco to roll out new technologies and services more quickly and effectively, while also achieving significant cost efficiencies.• - See more at: http://www.information-age.com/technology/data-

centre-and-it-infrastructure/123457598/verizon-transforms-tesco---s-infrastructure--#sthash.z5MyIp4Y.dpuf

Infrastructure Components of Tesco

 Computer Platform of Tesco• A computer platform is a system that consists of a hardware device

and an operating system that an application, program or process runs upon. An example of a computer platform is a desktop computer with Microsoft Windows installed on it. A desktop is a hardware device and Windows is an operating system.

Operating System Platforms of Tesco• In computers, a platform is an underlying computer system on which

application programs can run. On personal computers, Windows 2000 and the Mac OS X are examples of two different platforms. On enterprise servers or mainframes, IBM's S/390 is an example of a platform.

Enterprise Software Applications

Infrastructure Investments of Tesco

• Tesco is investing $45m in its IT infrastructure in a bid to solve problems more quickly and improve customer service.• The system - which will give the retailer an easy, at-a-glance view

of its global IT infrastructure - will cut costs and make it easier to manage its sprawling IT estate, the company said.• The grocer is consolidating a number of different systems into one,

allowing the entire estate to be viewed as a whole.• Previously, a number of different suppliers monitored separate

parts of the business but from now on one company, CA Technologies, will manage and monitor Tesco’s networks, transactions and suppliers across the company including its website, banking and mobile businesses.

CHAPTER 06

FOUNDATION AND BUSINESS INTELLIGENCE : DATABASE

AND INFORMATION MANAGEMENT

Organizing Data In A Traditional File Environment

• Computer systems organize data in a hierarchy that begins with bits and bytes and progresses to more complex groupings of data:

• Fields: Group of characters, words, or a complete number• Records: Group of related fields, describes an entity (a person,

place or thing about which information must be kept - each characteristic of an entity is an attribute• File: Group of records of the same type• Database: Group of related files

Database Management Systems of Tesco

• Large retailers, such as the largest – Tesco – are implementing RFID on a grand scale while smaller retailers are struggling with the value proposition, but are likely to be able to derive some momentum from the enormous changes the Wal-Mart mandate has effected on the product manufacturing industry. That mandate says that suppliers to Wal-Mart must equip their pallets with RFID tags. The deadline keeps moving, but it is now believed the deadline is sometime in 2007. However, the initial charter of the mandate has been extended from the top 100 suppliers to include all suppliers. Quite possibly, the top 100 suppliers have already complied.

Using Databases To Improve Business Performance And Decision-making Of Tesco

• Tesco use their databases to:• Keep track of basic transactions• Provide information that will help the company run the business

more efficiently• Help managers and employees make better decisions

• In Tesco company, special capabilities and tools are required for analyzing vast quantities of data and for accessing data from multiple systems, such as:• Data warehouse: a database that stores current and historical data from

core operational transactional systems for use in management analysis, but this data cannot be altered.• Data mart: A subset of a data warehouse in which a summarized or

highly focused portion of the organization's data is placed in a separate database for a specific population of users.• Business intelligence (BI) tools: Data analysis tools used for

consolidating, analyzing, and accessing vast stores of data to help in decision making, such as software for database query and reporting, tools for multidimensional data analysis (online analytical processing), and data mining.

Components Of A Data Warehouse Of Tesco

• The data warehouse extracts current and historical data from multiple operational systems inside the organization. These data are combined with data from external sources and reorganized into a central database designed for management reporting and analysis. The information directory provides users with information about the data available in the warehouse.

Hierarchical And Network Data Model Of Tesco

CHAPTER 07

TELECOMMUNICATION, THE INTERNET AND

WIRELESS TECHNOLOGY

Telecommunications And Networking In Today's Business

World• There are two fundamentally different types of telecommunications

networks: telephone networks and computer networks, which are slowly merging into a single digital network using shared Internet technology and equipment.• Both voice and data communication networks have also become

more powerful (faster), more portable (smaller and mobile), and less expensive.• Today more than 60 percent of U.S. Internet users have high-

speed broadband connections provided by telephone and cable TV companies running at one million bits per second.

Components Of Simple Computer Network Of Tesco

Corporate Network Infrastructure Of Tesco• Tesco’s corporate network infrastructure is a collection of many

different networks from the public switched telephone network; to the Internet; to corporate local-area networks linking workgroups, departments, or office floors.• Contemporary digital networks are based on three key technologies:

Client/server computingPacket switching

Computer Network

Computer Network With Tesco• Tesco will link its network across 12 countries over a single

infrastructure provided by Verizon.

• UK supermarket giant Tesco has announced a deal with Verizon to migrate to a single network infrastructure.• The solution will link all its operations across 12 countries, both for

internal corporate matters and partner/supplier communications.• The partnership will also build towards further projects, such as

providing customer Wi-Fi in store and a global desktop, integrating all its businesses onto a single platform.

Types Of Networks Of Tesco

How Tesco Communicate Together

TEAM5;• We share a weekly five minute face to face communication for all

colleagues. It is used to communicate the most important messages relevant to you and your role. It consists of three sections:help you to do your jobhelp you to serve your customers even betterkeep you informed of news and information happening in your

Distribution Centre

THE ONE• We produce a monthly colleague publication for all our people in

Stores, Distribution Centres and Offices that is available for you to take home. Each issue is packed with news, features, fun and competitions. Our colleagues are the stars of our business and you can send in your own news and stories.

OUR TESCO• Our Tesco internet site connects Tesco colleagues and allows us to

share skills and experiences. You can read news about Tesco and view helpful documents on www.ourtesco.com

STEERING WHEEL• The Steering Wheel is the tool we use to help us measure our

performance and manage the business in a balanced way. It plays an important role in communicating our strategy and our performance to all of our colleagues.• Customer– This relates to how well we are providing our customers

with what they need and expect.• People– This relates to our colleagues. Measures include how

colleagues feel about working for Tesco.• Finance– This relates to management of our costs and delivery of an

efficient operation and our stakeholder expectations.• Operations– This relates to productivity and the standards of our

working environment.• Community– This relates to what we do at a local level as a

neighbour and a member of a community and the wider role the business plays in society

How Tesco Communicate Together

CHAPTER 08

ETHICAL AND SOCIAL ISSUES IN INFORMATION

SYSTEM

Ethical and Social Issues Related to Systems Of Tesco

• Ethics are the principles of right and wrong individuals, acting as free moral agents, use to make choices to guide their behaviour.• Information systems raise new ethical questions for both individuals

and societies because they create opportunities for intense social change.• Ethical, social, and political issues are closely linked. Introduction of

new technology has a ripple effect in the current equilibrium, creating new ethical, social, and political issues that must be dealt with on individual, social, and political levels.• Both social and political institutions require time before developing

new behaviours, rules, and laws.

Moral Dimensions In An Information Society

• There are five main moral dimensions that tie together ethical, social, and political issues in an information society.

• Information rights and obligations• Property rights and obligations• Accountability and control• System quality System quality• Quality of life

Impacts Of Key Technology TrendsFour key technology trends have heightened the ethical

stresses on existing social arrangements and laws.

• Computing power has doubled every 18 months allowing growing numbers of organizations to use information systems in their core business processes. This growing dependence on critical systems increases vulnerability to system errors and poor data quality.• Advances in data storage techniques have enabled for

the multiplying databases on individuals maintained by private and public organizations - making the violation of individual privacy both cheap and effective.

•  Advances in data analysis techniques enable companies and government agencies use profiling to determine detailed information about individual's habits and tastes and create dossiers of detailed information.

CHAPTER 09

INFORMATION SYSTEMS SUCCESS

AND FAILURE

Dimensions of IS Success of Tesco

Information quality• Information quality refers to the quality of the information that the

system is able to store, deliver, or produce, and is one of the commonest dimensions along which information systems are evaluated. Information quality impacts both a user’s satisfaction with the system and the user’s intentions to use the system, which, in turn, impact the extent to which the system is able to yield benefits for the user and organization.

System quality• As with information quality, the overall quality of a system is also one of

the most common dimensions along which information systems are evaluated. System quality indirectly impacts the extent to which the system is able to deliver benefits by means of mediational relationships through the usage intentions and user satisfaction constructs

Service quality• Along with information quality and system quality, information systems

are also commonly evaluated according to the quality of service that they are able to deliver. Service quality directly impacts usage intentions and user satisfaction with the system, which, in turn, impact the net benefits produced by the system.

System use/usage intentions• Intentions to use an information system and actual system use are well-

established constructs in the information systems literature. In the IS success model system use and usage intentions are influenced by information, system, and service quality. System use is posited to influence a user’s satisfaction with the information system, which, in turn, is posited to influence usage intentions. In conjunction with user satisfaction, system use directly affects the net benefits that the system is able to provide.

User satisfaction• User , and by information, system, and service quality. Like actual

system use, user satisfaction directly influences the net benefits provided by an information system. satisfactionrefers to the extent to which a user is pleased or contented with the information system, and is posited to be directly affected by system use.

Net system benefits• The net benefit that an information system is able to deliver is an

important facet of the overall value of the system to its users or to the underlying organization. In the IS success model, net system benefits are affected by system use and by user satisfaction with the system. In their own right, system benefits are posited to influence both user satisfaction and a user’s intentions to use the system.

Measures Of Information System Success Of Tesco

1. HIGH LEVELS OF USE

2. USER SATISFACTION

3. FAVORABLE ATTITUDES

4. ACHIEVED OBJECTIVES

5. FINANCIAL PAYOFF

Information System FailureAN INFORMATION SYSTEM THAT:• DOESN’T PERFORM AS EXPECTED• ISN’T OPERATIONAL AT A SPECIFIED TIME• CANNOT BE USED AS INTENDED

Problem Areas Of Information System Of Tesco

CHAPTER 10

SECURING INFORMATION SYSTEM AND CURRENT

TRENDS IN MANAGEMENT INFORMATION SYSTEM

IT Security and Data Protection - Tesco

• We take very seriously the issue of IT security and data protection. As we accelerate our plans to deliver the most compelling multichannel offer for customers, managing technology and data security risks become even more important. In the Principal Risks section of our Annual Report we describe the following examples of relevant key controls and mitigating factors.

Technology Risk:

Any significant failure in the IT processes of our retail operations, online and in stores, would impact our ability to trade

As the digital marketplace grows, a lack of investment in technology, or investment in the wrong areas may constrain multichannel growth and impact our competitiveness

Insufficient investment in, or ineffective implementation of, controls over our online presence could increase the likelihood of a successful cyber-attack

Whilst investment is made in new technologies, there is a risk that investment is not made to maintain the controls over the existing technology, which may impact systems availability and security, including the security of personnel, supplier or customer data

As customers and colleagues become increasingly sensitive to matters of data usage, storage and security, the inherent reputational risks of the IT control environment have increased, in conjunction with the financial and regulatory risks

Key Controls And Mitigating Factors

Our IT strategy is approved and reviewed by the Executive Committee to ensure that investments in IT systems and innovations improve business efficiency and customers’ shopping experience.

We continue to invest in IT to respond to the growing range of IT-related threats and risks.

The Group Technology Committee monitors controls to maintain the integrity and efficiency of our IT infrastructure and data.

The Information Security Committee meets regularly to review the development and implementation of policies.

The reporting lines of our Group Information Security and IT Security teams have been merged to allow for better integration and efficiencies in addressing IT security risks.

Processes are in place to monitor and deal with significant IT security incidents.

Improved Group Wide Area Network infrastructure and the standardisation and centralisation of systems across international operations will help to improve the availability and consistency of technology.

Rigorous governance processes must be followed for new systems implementations and ongoing change management of existing IT

• Code of Business ConductIt is for everyone at Tesco to ensure that we protect our business,

our colleagues and our customers. Our Code of Business Conduct explains our most important responsibilities and duties, including using company IT and resources appropriately.

• Clubcard CharterClubcard is an important tool which helps us to personalise and

tailor our offer, as well as reward customer loyalty.

• Keeping customer accounts secureWe provide advice and tips for customers to protect themselves

and their devices, for all their online activities. www.tesco.com/staysafeonline/

• Emails alertsWe notify customers if they change any personal or security

details with us. This is an important fraud prevention measure that can alert customers to changes they haven’t made.

• Enhanced online securityWe use the latest technology to provide customers with the best

online experience. Not only does this reduce the risk of fraud, preventing fraudsters from using stolen security details to access customer accounts online, but it also makes online access easier

Current Trends In Management Information System Of Tesco

• Data Collection Automation

3% of the survey respondents said that market intelligence systems should be able to automate data collection by 2020. Increasingly, companies must implement systems to collect information online and in real time, so as to proactively identify and respond to emerging market opportunities and threats faster than the competition. - See more at: http://www.information-age.com/technology/information-management/123459665/3-trends-will-impact-information-management-systems#sthash.YpEtHnqZ.dpuf

• Information Analysis Automation

With the onslaught of big data and quantitative data, 91% of all respondents said they need the implementation of automated data analysis by 2020. In fact, 78% of the business managers surveyed considered big data to have a large impact on market intelligence activities. - See more at: http://www.information-age.com/technology/information-management/123459665/3-trends-will-impact-information-management-systems#sthash.YpEtHnqZ.dpuf

• Cross Function Integration

Almost two-thirds (64%) of all respondents expected information collection and analysis programmes to be integrated with other organisational functions in the future. This would certainly be a positive move. - See more at: http://www.information-age.com/technology/information-management/123459665/3-trends-will-impact-information-management-systems#sthash.YpEtHnqZ.dpuf

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