Explain how Tescos use information

Purpose of information

Operational support - Tesco will need to use information to track how many items they have to sell. They will use EPOS which stands for electronic point of sale; it is an automated till system used in many shops and restaurants. Tesco will use tills to monitor how many products are sold and if they need restock or reorder more items. When monitoring and controlling its activities Tesco can make immediate use of information from its operational support systems. When a customer purchases an item the EPOS system will track this and the data will be stored and keeps track of how much stock should now be in their store. When the stock levels are low, the warehouse is asked to prepare a delivery for the store. And then a delivery is sent to the store. This is beneficial to ensure they always have stock to sell.

Analysis - Analysis is where the business regularly does the same processing of its data. This is used to identify patterns or trends and to monitor the business. A business might produce weekly sales and cost reports. This would show a trend of whether profits are increasing or decreasing. For example, Tesco may use analysis to compare their performance to other competitive stores such as Asda, Morison's and Waitrose. They can then use this information to highlight if their competitors are doing better and decide new techniques to improve their own sales and performance. Analysis can also be useful when predicting sales and demand for the future. For example, they can also use analysis to identify patterns such as the increase in sales at Christmas and then Tesco will be able to know how much stock to buy in to prepare to compete with the high demand for their products.

Decision making - Information systems can be very useful for decision making when a problem or an issue arises and management need to take action to resolve it.  Management can take these decisions at various levels: operational, tactical or strategic. For example, the management of Tesco may want to reduce their costs, they may want to do this by finding cheaper suppliers or making some staff redundant. They can do this by finding information on the cheapest suppliers, and then buy their products there instead of previous suppliers. 

Gaining Advantage – Gaining advantage is making a company grow and make more profit. They can use their information with different or similar companies in the area and see things such as the prices for products and their company. They can then compare and come up with new ideas to gain more customers, such as reducing the price to products which could lead to more customers and more profit.