Strategic Management: Aldi's Approaches, Issues, and Capabilities

Strategic Management

Table of Contents
Deliberate and emergent approaches to strategy formulation.....................................................3
Critically assess the major macro environmental and industry issues that Aldi has faced.........4
3. Using Porter’s Value Chain framework, critically analyze Aldi’s strategic capabilities?....6
With the aid of the VRIO framework, assess the sustainability of Aldi’s strategic capability...8

Introduction
Strategic Management is continuing planning, analysis, evaluating and assessing all the
mandatory requirements of the company in order to meet with their targets and goals.
Modification in the business surroundings will need company to continuously evaluate their plan
of actions for more growth and success (Banihabib, Hashemi-Madani and Forghani, 2017).
Strategic Management caters entire direction by enhancing policies and plans which is designed
to accomplish goals and targets. This report is going to cover about Aldi Company. This
company is founded in 1946, Essen in Germany. Aldi is a discount grocery chain which is started
in Germany in 1948. This report is going to explain about the factors and issues which are faced
by the company in context of internal and external factor. Also, this report is going to explain
about the impact of macro and Strategic capability of the Aldi.
Main Body
1.Deliberate and emergent approaches to strategy formulation
There are various approaches to strategy formulation that are adopted by the
organization. It is important to know and understand the strategies and create a balance among
them. The effective strategy helps to accomplish the goals and objectives on time. Aldi was
founded by Karl and Theo Albrecht in 1946 (Napshin and Marchisio, 2017). The company made
various efforts to become the best retailer of grocery in Germany. It is important for the company
to know about the importance of various strategies. The deliberate and emergent strategies in
regard to Aldi are discussed.
Strategy refers to actions that are used by organization to achieve competitive advantage.
It helps to understand the strength and get prepared for the opportunities. The weakness of the
organization should be overcome and get prepared for the threat is also an important thing to be
considered. Strategic planning refers to formulation of long term plans keeping in mind the
internal factors of the organization. This can be done with the help of two approaches that are
discussed below in regard to Aldi:
Prescriptive Approach to Strategic Planning
This is the first approach that considers mission, vision and values of the organization.
The strategic plan is made according to intentions and priorities of top management. In relation
to Aldi the company formulates strategy by first analysis the situation then policy formation and
then implementation of the strategy. It is done in an order as it is important to form the strategy
by following the step and knowing about the values of the company.
Emergent Approach to Strategic Planning
Emergent approach of strategy formulation shows that the strategies of organization are
formulated due to the current events that occur. Aldi is flexible and formulates strategies in a

manner that helps the organization to formulate strategy at the time and implement the same. As
there are various events that occur and there are various changes and it is important that
organizations are able to formulate strategies based on the scenario (Cavicchi and Vagnoni,
2018).
In relation to Aldi the company always prepares strategies and get prepared for the future.
They make strategies using perspective approach so that the vision of the organization is
fulfilled. The higher management is not prepared about the uncertainties. This shows that if there
is a situation for which company is not prepared then it will be problematic. As they will not be
able to form strategies at that time.
There should be balance between both the approaches so if there is need to formulate
strategy they are able to formulate it as well as implement the same. Aldi should form strategies
in such a way that shows there is good balance between both the approaches. As future is
uncertain the company should follow ways in which there is a balance between deliberate and
emergent approaches to strategy formulation. Also this will help company in future and they will
able to complete the targets on time.
Factors to be considered while formulating strategies
To formulate the strategy effectively it is important that these factors are taken into
consideration. As the strategy formulation will help the company ton accomplish all the goals
and objectives on time. It is seen that they share of Aldi in 2017 rise by 19.8 percent whereas that
of competitors increase by 1.6% only.
Workers: The company focus on the internal stakeholders. As they are the one who actually
perform for the organization (Allison, 2019). The production is in the hands of the employees.
So, it is important that their roles and responsibility are clear.
Delegation: The delegation of responsibility is in hierarchy that helps the company to have
accountability and transparency in the work.
Resources: This is the strength of Aldi. The company focuses on catering resources and
providing the customers with goods that are high quality and low cost.
All these factors help Aldi to formulate strong strategies that help the company to
accomplish the goals and objectives.
2.Critically assess the major macro environmental and industry issues that Aldi has faced.
ALDI is a global business organisation which is performing its function from last number of
years. Organisation is working with the retail industry where it is performing its functions by
competing with number of competitors and facing different challenges in macro environment. It
is essential for the organisation to scan its macro environment and perform according to it so that
it can achieve better results and maintain decorum according to the requirement. And order to