Analyzing Aldi's Strategy Formulation and Responses to Challenges

STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
Critically analysing balance of emergent and deliberate approaches to strategy formulation
that has been adopted by Aldi in the past....................................................................................3
Critically assessing major industry and macro-environmental problems that supermarket has
faced in the past and its responses in regard to these as well as their effectiveness...................5
Using porter's value chain concept to critically analyse Aldi's strategic capability and VRIO to
assess sustainability of company's strategic capabilities.............................................................8
Critically examining previous strategies of Aldi by using Porter's generic strategy model and
Ansoff Matrix............................................................................................................................12
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Strategic management is described as procedure of setting aim, objectives and processes
in order to make organizations more competitive. It caters overall directions and appropriate
ways to a company, which it may use to gain current as well as further benefits in term of
gaining competitive edges and increasing sales even better than their competitors. It is also
defined as set of effective actions and practical decisions which management may undertake to
obtain desire outcomes. The current assignment will be base on Aldi, which falls under list of
leading supermarkets in the United States. The study will explain balance of deliberate and
emergent approaches to tactic formulation that has been adopted by organization in the past. It
will define extent to which that balance has been right and then suggestion based on analysis.
Furthermore, the report will justify major macro environmental and sector problems that firm has
faced earlier and its responses in context of these.
It will explain usage of porter's value chain framework to analyse strategic capability of
supermarket. Lastly, the assignment will clarify previous tactics of Aldi by using porter's generic
strategy framework and Ansoff Matrix. Moreover, it defines analysis on the basis of approach to
internationalization that company has adopted.
TASK
Critically analysing balance of emergent and deliberate approaches to strategy formulation that
has been adopted by Aldi in the past
Deliberate tactics are used to achieve set aims and objectives of a company, while
emergent strategies are utilized in context of absence of goals to create a new and effective ones
in the future (Krishna, Connaughton and Linabary, 2020). These types of strategies are
formulated by using specific model or concept. In the world of business varied models are
available, which Aldi used in past to formulate its strategy. For example, Blue Ocean Strategy
is one of the best business strategies and used in term of deliberate and emergent approach by
many companies, to formulate effective strategy. Aldi also adopted this method in the past to
gain competitive advantages and generate profits, which is quite essential. It is based on
alignment of three key tactic positions of value, people and profit. It helps organization to be
ahead of competition within retail sector. With this approach, company has taken effective and
appropriate decisions in term of strategy formulation related to reconstruct market limitations.

According to this, supermarket develop strategy to open an average of 30 new outlets annually.
Firm has adopted Blue ocean strategy as a model and efforts to formulate this tactic, which has
provided varied benefits to company in term of increasing its sales, and made it able to be a
strong competitor against other brands that are operating in retail sector from longer period
(Suhendi, 2020).
Along with that, in term of emergent approach, Aldi has formulated strong marketing
tactic, which is a combination of its emergent and deliberate tactics that help to generate brand
awareness within those places where it has established 30 new stores (Van Kampen and
Kirkham, 2020). Firm balance the both methods in effective manner in context of strategy
formulation that has been adopted by its venture in earlier period.
Extent to which that balance has been right and why-
As discussed above, in term of deliberate approach company has formulated strategy to
develop 30 outlets and in manner of emergent approach, Aldi has created strong & beneficial
marketing strategy. Both these tactics provide a lot of benefits to company, its management has
balanced these in systematic and excellent manner, in the way of high extent. The balance
between the above two approaches has been appropriate because opening a new store is not that
much touch, but to gain the attention of people towards purchase is much harder than any other
practices of companies. Aldi balance both activities in appropriate manner, by taking decision to
open new store and on the same time by developing strong marketing plan, which made it more
successful and boost its performance in the world of retail.
Suggestions and justifications-
It can be said that by considering more approaches, techniques and processes, a company
may get more opportunities related to growth and success of ventures. In context of Aldi, varied
forms of suggestions in term of above concepts available in the market that help to transformed
balance of deliberate & emergent approaches for the future.
 The balance of both methods related to strategy formulation should be transformed in the
future, by managing the existing shops and opening at emerging regions or nations,
where people seek to purchase quality items and services from well-known and the most
trusted brands in the world. Instead of establishing new outlets everywhere, firm can
focus on managing current ones and starting ventures at those places where the
requirements of quality products is reach at high extent. This kind of transformation