TESCO Strategic Dept.
Project name Tesco Superstore
Release Draft Version
THE PROJECT IS INVOLVED WITH THE DEPLOYMENT OF A NEW TESCO
SUPERSTORE IN LIVERPOOL.
AS PROJECT MANAGER YOU WILL NEED TO SELECT A SUITABLE LOCATION THAT
WILL NOT ONLY ENSURE A STRONG BUSINESS CASE WHICH IS FINANCIALLY
VIABLE, BUT WILL ALSO ADDRESS THE RISKS AND STAKEHOLDERS INVOLVED, IN
LINE WITH TESCOS STRATEGIC CORPORATE VALUES.
IT IS VITAL THAT THE PROJECT IS DELIVERED IN A TIMELY MANNER TO
TIMESCALES CONSITENT WITH THE INDUSTRY NORM.
THE BOARD WOULD EXPECT THE STORE PROJECT TO PROGRESS IN A SIMILAR
MANNER TO PREVIOUS DEPLOYMENTS ON A SIMILAR SCALE – SPECIFICALLY IN
TERMS OF VIABILITY OF BUSINESS CASE, TIMESCALES, BUDGET AND FIT WITH
RESPONSIBILITY FOR THE PROJECT ENDS WITH THE HANDING OVER OF THE
STORE TO OPERATIONS AND THE OPENING OF THE STORE TO CUSTOMERS.
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EXPECTATIONS OF PROJECT MANAGER
As Project Manager you would be expected to consider:
a. the key stages and associated tasks that will need to be competed in order to ensure
the overall success of the project.
b. what are the project management processes and techniques that should be applied
during the life of the project, and how these contribute to the project’s success or
failure. The board would expect at least: a definition of the scope; clearly identified
goals and success factors; producing a project plan(of tasks, durations and overall
timescales); identifying suitable roles/job titles from the company to ensure the right
team is formed; a method to address the management of risk. Any additional elements
which as Project Manager you could consider important would also be welcomed.
c. what are the important skills and competencies required by the project team and
Project Manager in order to deliver a successful project;
PROJECT PROCESS DELIVERABLES
The following 4 documents/items should be created which could be used in the project
with a supporting report that briefly gives reasons and explanations for the approach
1. a stakeholder analysis which:
identifies key stakeholders
shows the reason for the stakeholders’ interest and their motivations,
provides suggestions for how the stakeholders can be engaged with and
forms the basis of a communication plan
2. a Project Brief which is structured and includes appropriate and relevant
3. a project plan in MS Project that would be suitable for presenting to and
engaging with stakeholders. It should show key stages, tasks, milestones and a
critical path. When printed, the plan should be no larger than one sheet of A3
4. a risk analysis which identifies and categorises risks as well as their associated
mitigating actions. The analysis should include elements that enable it to be
presented easily to the project’s key stakeholders.
After an evaluation of its performance and the number of superstores it has in the city,
the Board of Tesco has decided to setup a large superstore in the Liverpool area. The
key aim of this store is to improve profitability and strategic presence of Tesco Group
within the North West.
Supermarkets see an increase in floor area of their total estate as a way of delivering
the increased profits demanded by shareholders.
Typical profit growth could be expected to be around 5% per annum, driven by new
stores and extensions to existing stores.
Supermarkets will seek to keep capital costs down, thus increasing return on investment
and/or a shorter payback period.
In determining procurement options, the primary objectives for supermarket clients are:
• Overall speed of project delivery
• Certainty of cost and programme
• Minimum capital cost.
Progress towards meeting these and other objectives are commonly monitored by
clients using bespoke KPI systems, assessing performance on a project-by-project
basis and providing a framework to drive continuous improvement.
How big and how much?
A typical small supermarket has a sales floor area of 1,000m2 , a standard
suburban/town superstore around 3,000m2 and an out-of-town hypermarket around
Costs in 2003 for a supermarket with sales floor area of 50,000 square foot, with
associated car parking but no petrol station, were around £8.4million (1 square metre is
approximately 10.75square foot). This is based on a competitively tendered works
packages from framework contractors, at average UK price levels. Project costs are
inclusive of preliminaries, and contingencies. Demolitions and site preparation,
professional fees, client on-costs and VAT are excluded. Rates in the model may need
to be adjusted to take account of specification, site conditions, procurement route and
What’s involved in this project?
For the Tescos Superstore Project, the North West of England has been identified as
being an area where construction costs are lower than other areas of the country, so
are potentially attractive for new store builds. Using a simple payback period
calculation, a target has been suggested that the costs of building the store should be
matched by the pre-tax profit generated by the store within the first 3 years of operation.
An analysis has been carried out on behalf of Tesco by external consultants. The
analysis considered locations of existing Tesco stores, size and location of competitor
stores, and demographics of the local population. It concluded that a new superstore in
a suburb of Liverpool would provide a suitable new development site for a mid-sized
TESCO Strategic Dept.