Business Strategy Report: Aldi's Strategic Planning and Implementation

This report provides a comprehensive analysis of Aldi's business strategy, delving into its mission, vision, objectives, goals, and core competencies. It examines the factors Aldi considers when formulating strategic plans, including market position, customer demand, and competitive advantages. The report also evaluates the effectiveness of various strategic techniques, such as the Ansoff matrix, and conducts organizational and environmental audits to assess Aldi's internal and external factors. Furthermore, it explores the importance of stakeholders in strategy formation, presents a new strategy for the firm, and analyzes the roles and responsibilities of personnel involved in strategy execution. The report highlights the essential resources needed for executing strategies and how SMART targets contribute to achieving strategic objectives, providing a detailed overview of Aldi's approach to business management and strategic planning.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Mission , objectives, visions, goals and core competencies of Aldi................................1
1.2 Factors to be considered by Aldi during formulating their strategic plans......................2
1.3 Effectiveness of techniques..............................................................................................4
TASK 2............................................................................................................................................5
2.1 Organisational audit of Aldi ............................................................................................5
2.2 Environmental audit of Aldi ............................................................................................6
2.3 Importance of stakeholders while forming new strategy.................................................7
2.4 Presentation of new strategy for the firm.........................................................................8
TASK 3............................................................................................................................................9
3.1 Analysing of proper strategy for Aldi.............................................................................9
3.2 Justification of one strategy..............................................................................................9
TASK 4..........................................................................................................................................10
4.1 Roles and responsibilities of personnel who are engaged in execution of strategy.......10
4.2 Essential resources needed for executing strategies ......................................................11
4.3 How the use of SMART targets can contribute to achieving the strategic objectives...12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Business strategy can be simply defined as schemes that is being utilised by every
venture in order to run their commercial activities in effective manner for achieving their pre -
determined goals and objectives (Woodcock,Green and Starkey, 2011). This helps in upgrading
whole performance and turnover of company. Additionally, such plan of action also aids in
managing all works of other departments that are responsible to carry out specific job within
given time period. This report is completely based on Aldi which is a popular brand of two major
global discount supermarket. They are comprising of over ten thousand stores in more than 19
countries. Aldi is dealing with retail sector and are providing goods like food stuffs, beverages,
household or domestic commodities, sanitary items and many more. This has been examined that
they are making income of around €50 billion. This chain was set up by Karl and Theo Albrecht
in 1946 who are two brothers. In this project, aims, objectives, goals, mission and vision of Aldi
has been discussed properly. Besides this, some of the factors which are considered while
making business plan is also described appropriately.
TASK 1
1.1 Mission , objectives, visions, goals and core competencies of Aldi
A mission statement simply refers to the entire purpose of roles via which firm serves
and offers the needed help to its shareholders at large. The key mission statement of Aldi are
stated below :
 They are having notion of creating abilities of their corporation in a global rivalry
environment by giving them sustainable or first-rate value to their stakeholders.
 They also wishes to provide better level of customer partnership by enhancing the
effectiveness of their best commercial system and control.
Vision : This is nothing but an idea which incline to be in future or decides where or what the
venture has to be carry out in upcoming days for meeting the requirements of stakeholders
efficaciously and effectively. Key vision of Aldi are mentioned as follow :
 They desires to grow economic value in UK. In addition to this, they also wishes to make effective supply chain networking in order to
strengthen the delivery system.
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Objectives : It refers to a short time framed mission of an enterprise that needs to be completed
in proper manner. The main objectives of Aldi are listed below :
 They desire to make themselves consumer centred and try to meet all the needs or
demands of their potential users. They also aims to create value for share holders.
Goals : It is some how same as objectives but the only difference is that it is long term and are
usually the end purpose of specific planning. Goals of Aldi is stated below :
 Aldi tries to create multiple drivers of development by designing fantastic business
portfolio and capacities (Tsamenyi, Sahadev and Qiao, 2011). They also attempts for strengthening and refining their corporate governance by
generating accountability.
Core competencies : It is nothing but well defined qualities and expertise comprises a company
that differentiates its whole functioning as well as success from another existing firm which is
dealing with similar products or services. The core competencies of Aldi are described below :
 Expertness in technological as well as functional knowledge
 Produces better qualities of products and services in relation to other enterprises.
The mission, vision, goals, objectives, core competencies inform strategic planning since
these all are important techniques that helps in framing proper schedule of organisational work
so that targets of the venture can be achieved within specific time frame. Aldi should do the same
in order to gain high sum of benefits. After designing these things, managers have to
communicate these modes of strategical planning to each and every worker so that work can be
started in similar direction. Mission of a working organisation shapes the objectives, services and
their core competencies in numerous manner as according to its grounds, a company form their
products and services in more efficient manner. Aldi's mission is to grow and meet success
which are attributed to their commitment to create the level of efficiencies from the production,
distribution and certain services level that organisation stock. Enterprise structure and form their
services and products in order to accomplish their main statements and mission which helps them
in creating more productive, creative and diverged products along with better quality. Hence, the
whole procedure is more supportive and directive in terms of shaping their views and opinions in
more significant manner.
1.2 Factors to be considered by Aldi during formulating their strategic plans
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Every firm needs to identify as well as evaluate their external and internal factors before
making plan of action. Inner components are those that are linked with business activities
internally and exterior one are such prospects which are connected with outside world.
Therefore, these factors are very essential to understand in order to gain sustainability and
accomplishment of targets of firm effectively. Those elements consisting of some goodness as
well as limitations also that required to be evaluated correctly as this would help in the
formulation of strategical plans so that long term ambitions can be achieved properly.
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There are different factors such as market position, customer demand and competitive
advantage that requires to be considered by Aldi while making strategies which are described
below :
 Market position : Before starting any business plan, it is essential to determine about the
specific place wherein company is going to begin its commercial activities i.e.
marketplace. Aldi should identify proper location in order to enter into new market and
observe external and internal factors which are existing over there.
 Customer demand : All the requests and demands of users must have to be determined
before framing any plan of action since deliverables are prepared for them only.
 Competitive advantages : Aldi also need to survey about their potential rivalries so that
they can examine their strategies and made their own that would be better from them.
This helps them in attracting more consumers and thereby gaining competitive benmefits
from the same.
The above mentioned factors are required to outline and undertake before implementing
any plan and strategy within a working organisation assisting the whole company in achieving
their business objectives. Through understanding the major consumer demands and preferences
in market, new product development, strategy designing and evolution is done by Aldi. Also, for
understanding market position and competitive edge of firm, Aldi spend more than 25% of their
revenues on market research. Hence, this assist them in reaching to the core of their choice,
required marketing activities along with identification through which enterprise can achieve their
business objectives and competitive edge in more significant manner.
Some of such factors that is needed to be focussed by Aldi at the time of designing its
strategies is discussed below along with their benefits and limitations :
Factors Advantages Disadvantages
Internal A skilled and well educated
employee will surely aids in
accomplishing entire business
goals in effective style (Teece,
2010).
But sometimes, work – forces
do not get quenched by the
norms made by Aldi and due
to this they do strike for the
same. This as a bad result
totally damages its brand value
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and image also.
External Things associated with
technology comes under this
category and helps firm in
growing its productivity level
in less time period.
But these technological aspects
or machineries gets outdated
on consistent manner. Thus,
Aldi has to make separate
accounts for the same and
should make strategies for
maintaining adequate balance.
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1.3 Effectiveness of techniques
There are large number of suited tools that is considered as helpful in developing correct
business plan. But for every satisfactory strategy, it is compulsory to take use some better
techniques through which company can attain its ambitions. Key approaches are examined that
aids during formulating business strategies. Some of them are Boston, Space and Ansoff matrix.
Such tools are treated as very powerful as it assists in entering to a new marketing
location and attracting large number of customers towards their firm. From those collection,
Ansoff matrix is examined as an effectual tool at the time of dealing with growth of business and
objectives of current as well as future in context to operational actions (Scholes, 2015). Aldi
should required to focus on each of the strategies provided by this matrix and ought to take
actions as per this. Strategies offered by Ansoff matrix are stated below : Market penetration : As per this scheme, existing products that is being manufactured by
venture is needed to improve in effect – able way by utilising several methods. For doing
the same, Aldi requires to increase their pricing strategies, sales promotions ion context
to business and many other actions. According to this, company have to concentrate on
their market and clients as well. Market development : In accordance to this strategy firm requires to sell their productions
or deliverables in a new market area. Herein, they are not obligated to improve their
goods but have to use appropriate plans for making new users at that region where they
are investing. Product development : This is refereed as a growth strategy where - in company should
concentrate on their present offerings and need to develop the similar productions for
existing market – place. This could be achieved by adding extra values and providing
better quality services to their expected users.
 Diversification : This on the other hand is used when an enterprise is going to lead or
represent some new deliverables at a new commercial place. Thus, it can be sad that in
this prospect, every thing is new that is goods as well as consumers.
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(Source : Ansoff matrix, 2016)
Cause of digitalisation, enterprise can evolve in the specific region of market and expand
their business internationally. Aldi has optimise Ansoff mix as the strategy of developing
business projects, expansion of business organisation along with reaching to the strong position
of marketplace. Hence, most of the international strategies of company are based over the
expansion strategy that is facilitated through the Ansoff Mix helping them in meeting determined
outcome of Aldi. The company is one of the successful and largest retailing organisation in
United Kingdom that has reached this far with the assistance of effective business strategies
implemented by company.
TASK 2
2.1 Organisational audit of Aldi
This has been observed that Aldi has been rated as one of the best supermarket of United
Kingdom keeping past high – ranked venture that is Waitrose down to fourth position. Aldi has
been divided into two separated groups in the year of 1960. After this, they become famous as
Aldi Nord having its headquarter in Essen and Aldi Sud whose headquarter is situated nearby
Mulheim. After that, it has been examined that this brand is named as Aldi in the year of 1962.
This was established in Great Britain on 5th April 1990 (Peteraf, Gamble and Thompson 2014).
They are having around 550 stores during 2006. but yet considered as small actor there as they
comprises of lower than 3.6 % shares of grocery. Thus, management and administration of this
venture should explore about its strength, weaknesses, threats and opportunities. In order to
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Illustration 1: Ansoff matrix

perform organisational audit of cited firm, SWOT analysis is going to be conducted which is
mentioned below :
Strength :
 They are offering supreme quality of goods and services to their potential users.
 They also provide products at lower or affordable costs in relation to other compitors.
 They are having strong existence in Germany as having around 25000 stores. Doing their business activities in over 15 countries globally.
Weaknesses :
 Smaller player in Great Britain
 In some times, they are claimed to have a store with cheap or low quality productions. In spite of performing commercial actions in 15 nations, they are still small in
comparison to another brands.
Threats :
 Large number of rivalries are enhancing on continuous basis such as Sainsbury, Tesco,
Lidl, Asda, etc. Their private label brand are getting tossed away by another established or popular
brands (Montgomery, 2011).
Opportunities :
 Needs to invest large sum of money in advertisement for tackling their competitors.
 They can also enlarge their business in continents like Africa and Asia.
2.2 Environmental audit of Aldi
This has been observed that business surroundings wherein company operates keep
changing constantly. Therefore, Aldi needs to identify all external factors and such aspects which
would impact overall performance and commercial operations of enterprise. This can be done by
taking use of porter's five forces (EXTERNAL FACTORS THAT AFFECT A BUSINESS, 2017).
This has been described below : Bargaining power of buyers : This is high as so many options are present for users and
they prefer those whose prices is low. For example, customers can go for other firms also
like Tesco, Lidl, Asda, Ikea, etc. for purchasing goods and services. Bargaining power of suppliers : This is quite low as numerous of suppliers are present in
this retail sectors and due to this ready for supplying products at minimum prices. For
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instance, there are large number of suppliers present in different nations or places
wherein Aldi is operating its business like Germany, Australia, Austria, Belgium, China,
Denmark, France, Hungary, Ireland, Italy, Luxembourg and many other countries. Threats of substitutes : This is also very high as same products is being offered by other
brands that is provided by Aldi (Martin and Rice, 2010). For example, Sainsbury,
TESCO, Morison , ASDA, etc. all are bringing identical products at marketplace so
client could be more enchanting to them. Industries rivalries : Additionally this is high as large number of ventures are doing same
business activities in UK. For example, Lidl, Tesco, Sainsbury's , etc. are offering
similar goods as Aldi is providing to users. Thus, Threats of substitutes is more for them.
 Threats of new entrants : The retail sector is very common thus many other small or big
firms are taking entry in this industry. Hence, threats of new entrants is considered as too
high. For instance, Kaufland has recently entered into German market and are giving
similar merchandises.
Hence, by the assistance of Porter's Five Forces, company can achieve their business
objectives and targets through reaching to competitive edge of enterprise in more significant
manner. Company can meet their requirements and efforts by the help of Porter's five forces that
help in understanding the major forces which can shapes the competition of enterprise within the
commercial industry. Aldi frequently opt this procedure for better profitability, attractiveness and
competition in intensity within the market.
2.3 Importance of stakeholders while forming new strategy
A stakeholder is the person who can affect the outcomes of projects. The role of
stakeholder is to give proper shape to projects in starting phase with help of contribution of
available resource which aids to project success. Employees, concerned people and legal bodies
who are involve in proper moving of business act are determined as stakeholder of business
projects. Therefore management of the organisation should interpret their shareholder according
to demand and conduct appropriate action for them. Aldi should focus on their main stakeholder
and segment them according to there preferences in taking important decision. Aldi is moving in
appropriate manner but desire of manager to increase shares of Aldi in market place. Aldi
categories their stakeholder into three categories: internal stakeholders, Connected stakeholder
and External stakeholder. For proper mapping of Stakeholder. Aldi can take help of Mendelow's
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matrix which aids to set priorities. The matrix has been divided in to four boxes which is given
below: Box A- Minimum effort: Different business partners of Aldi are suppose to losing their
interestingness due to implementation of negative impact. Box B- Keep informing: Nature of business partners are very peculiar but they do not
possess any power to take any step (Köseoglu and et. al., 2013). Box C- Keep satisfied: organisation should keep satisfied there stakeholder so that they
do not loose their involvement.
 Box D- key players: They are key factor which can change or halt nay scheme if they
are displease. So it is essential to give information regarding any strategy
implementation and also get them aware about profits (Mendelow's matrix, 2017).
(Source : Mendelow's matrix, 2017)
2.4 Presentation of new strategy for the firm
Manager should give focus on designing the appropriate strategies for sustain remarkable
position in the market for long period of time. Organisation have opportunities to invest large
amount of capital in various nation where there is unavailability of store at present time. This
will help the companies to capture more share in the market.
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Illustration 2: Mendelow's matrix