Tesco has opened up a lead in the supermarket superleague by exploring new non-food and online markets, and building its brand image on value for money, writes Elaine Knutt. Its attitude has also made it a leader in supermarket design and construction, and the industry's clear choice as Client of the year.
With a £1.6bn investment programme last year and a commitment to cost savings that can be passed on at the check-outs, Tesco has been a long-term champion of partnering and supply-chain management. It was enjoying the results while other clients were ordering their copies of Rethinking Construction: between 1992 and 1999, it cut average development costs by 40%.
As its contractors and consultants confirm, Tesco projects run to timetable and budget, its partnering workshops promote shared ownership of new ideas, and there is little room for contractual posturing when the contracts run to just one page. "Its a great relationship with a good degree of loyalty all round," comments Dick Side, managing director of Kier Regional, one of the Tesco's "G7" group of contractors.
Ken Simms, director of Michael Aukett Architects, appreciates that Tesco's "clear management structure" and the single voice heard along the chain of command from project controllers to operations director Kevin Pleass and chief executive Terry Leahy. "They're a tough organisation, no different from any other commercial organisation, but they want to innovate and create buildings that are good quality." Michael Aukett has worked with Tesco since it turned away from "Essex-barn architecture" in the early 1990s. In its place, it has pioneered light, airy stores with maximum glazing for optimum daylighting, simplified air-conditioning and standardised components. A pilot store in South Wales is part of a search for the ideal kit of co-ordinated parts.
But standardisation exists alongside one-off projects. After building flats above stores in Hammersmith and Cromwell Road, Tesco now has mixed-use plans for further London sites. "They're willing to work at the leading edge of urban regeneration. It's good for architecture, and good for the community," says Simms.
Like all pioneers, Tesco is now looking for the next challenge – a 30% reduction in construction costs by 2003. With a store development programme driven by a search for value and quality its shoppers would recognise, Tesco looks certain to achieve it.
Building Awards 2001
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Client of the year