Analysis of Aldi's HRM Strategies and Their Effectiveness

Desklib offers solved assignments and past papers to help students succeed.

HUMAN RESOURCE MANAGEMENT
1

Contents
LIST OF FIGURES.......................................................................................................................3
INTRODUCTION........................................................................................................................4
BODY........................................................................................................................................ 5
OVERVIEW OF THE ORGANIZATION.....................................................................................5
PURPOSE, ROLES AND RESPONSIBILITIES OF HR FUNCTIONS AND HOW THESE FUNCTIONS
PROVIDE APPROPRIATE SKILLS AND TALENT TO BUSINESS OBJECTIVES..............................6
ASSESSMENT OF WORKFORCE PLANNING, RECRUITMENT AND SELECTION,
DEVELOPMENT AND TRAINING, PERFORMANCE MANAGEMENT AND REWARD SYSTEM
AND CRITICALLY EVALUATE THE STRENGTHS AND WEAKNESSES OF DIFFERENT
APPROACHES TO RECRUITMENT AND SELECTION, SUPPORTED BY SPECIFIC EXAMPLES.....8
APPROACHES AND EFFECTIVENESS OF EMPLOYEE RELATIONS AND EMPLOYEE
ENGAGEMENT AND COMMENT ON THE ADOPTION OF FLEXIBLE WORKING PRACTICE AND
EMPLOYER OF CHOICE AND EXPLORE AND EVALUATE DIFFERENT METHODS USED IN HRM
PRACTICES IN THE ORGANIZATIONAL CONTEXT.................................................................12
ANALYZE INTERNAL AND EXTERNAL FACTORS THAT AFFECT HRM DECISION-MAKING IN
THE ORGANIZATION AND EVALUATE THE KEY ASPECTS OF EMPLOYEE RELATIONS
MANAGEMENT AND EMPLOYMENT...................................................................................14
CRITICALLY EVALUATE EMPLOYEE RELATIONS AND APPLICATIONS OF HRM PRACTICES
THAT INFLUENCE DECISION-MAKING IN THE ORGANIZATIONAL CONTEXT AND ALSO
EVALUATE THE KEY ASPECTS OF EMPLOYEE RELATIONS MANAGEMENT AND
EMPLOYMENT LEGISLATION THAT AFFECT HRM DECISION-MAKING IN GIVEN SCENARIO19
CONCLUSION.......................................................................................................................... 21
REFERENCES........................................................................................................................... 22
2

LIST OF FIGURES
Figure 1: Aldi Sud......................................................................................................................5
Figure 2: Aldi Nord................................................................................................................... 5
Figure 3: HRM FUNCTIONS.......................................................................................................6
Figure 4: WORKFORCE PLANNING CYCLE.................................................................................8
Figure 5: SWOT ANALYSIS OF ALDI.........................................................................................14
Figure 6: PESTEL ANALYSIS OF ALDI........................................................................................15
3

INTRODUCTION
The following report will focus on the analysis and evaluation of the HRM functions and
roles and how these help in achieving the objectives of the organization. The evaluation of
the strength and weaknesses of different recruitment and selection approaches will be
described along with the examples. The report will also discuss the effectiveness of
employee relations and employee engagement and evaluation of different HRM methods
used in ALDI. A detailed analysis of internal and external factors and HRM practices that
affect and influence the HRM decision-making in the organization will also be provided to
understand the working procedures of the ALDI.
4

BODY
OVERVIEW OF THE ORGANIZATION
ALDI is a privately owned retail chains by two brothers having 11,234 stores until 2018 in
almost 20 countries of the world that gives an annual turnover of 50 Billion Euros (Haas and
Petz, 2017). ALDI was founded in 1946 and split into two parts as Aldi Nord and Aldi Sud in
1960 by Karl and Theo Albrecht. The products offered at retail outlets of ALDI comprises of
food, beverages, sanitary products, household essentials, etc. ADLI has provided
employment to 125,977 people till 2017 is planning to open 80 new stores in the UK in 2019
and would recruit for 5000 vacancies in the store (Haas and Petz, 2017).
Figure 1: Aldi Sud
(Source: Ochoa and Lorimer, 2017)
Figure 2: Aldi Nord
(Source: Ochoa and Lorimer, 2017)
5

6

PURPOSE, ROLES AND RESPONSIBILITIES OF HR FUNCTIONS AND HOW
THESE FUNCTIONS PROVIDE APPROPRIATE SKILLS AND TALENT TO
BUSINESS OBJECTIVES
HUMAN RESOURCE MANAGEMENT (HRM): HRM refers to the recruitment, selection,
deployment and management of the employees in the organization to accomplish the set
standards and achieve the desired goals of the business (Cascio, 2015).
FUNCTIONS OF HRM
There are various functions of HRM that are important to be followed in an organization
which are:
Figure 3: HRM FUNCTIONS
(Source: Bratton and Gold, 2017)
Recruitment and selection: It is the primary function of the HR department to estimate the
requirements of the employees within the organization and screen and select talented
candidates for the business (Cascio, 2015).
Employee orientation: This program is conducted by the HR manager for helping the new
employees to inform about their job roles and responsibilities and helping them adjust to
the organization.
7

Training and development: The responsibility of HRM lies in providing training to the
employees through various training methods in order to enhance their skills and abilities
and thus, increase their productivity and efficiency (Cascio, 2015).
ROLES AND RESPONSIBILITIES OH HR DEPARTMENT
The roles and responsibilities of the HR manager in an organization include recruitment,
selection; training and selection of the employees in an organization and providing them a
peaceful work environment by maintain good employee relations and resolving disputes
fairly and giving rewards and appraisals for excellent performance to increase their
motivation and achieve the goals of the organization effectively and efficiently (Bratton and
Gold, 2017).
OBJECTIVES OF ALDI
The company aims at:
 Providing good quality products to the customers at a reasonable cost
 Achieving profitability in business and increasing the market share of the company
by opening 650 new stores within 5 years
 Dealing with complaints fairly and quickly to maximize customer satisfaction (Ochoa
and Lorimer, 2017).
Thus, HRM functions are very helpful in achieving these objectives as the selection of
talented personnel and training and development of employees leads to increase in the
effectiveness of the employees which improving their performance and providing better
results. The good working conditions provided to the employees will help in increasing
their productivity and reduce errors and wastage which will help in reducing the cost
and improving the quality of products and thus achieving the goals of the organization
with the highest efficiency (Bratton and Gold, 2017).
8

ASSESSMENT OF WORKFORCE PLANNING, RECRUITMENT AND SELECTION,
DEVELOPMENT AND TRAINING, PERFORMANCE MANAGEMENT AND
REWARD SYSTEM AND CRITICALLY EVALUATE THE STRENGTHS AND
WEAKNESSES OF DIFFERENT APPROACHES TO RECRUITMENT AND
SELECTION, SUPPORTED BY SPECIFIC EXAMPLES
WORKFORCE PLANNING
Workforce planning is a continuous process of estimating, arranging and managing human
capital within the organization.
Figure 4: WORKFORCE PLANNING CYCLE
(Source: Sousa, 2018)
The HR manager is responsible to plan the workforce of the organization by estimating the
current and future needs and recruiting skilled personnel as per the requirement and
implementing learning and development measures in order to maintain the efficiency of the
workforce (Sousa, 2018).
RECRUITMENT AND SELECTION
The recruitment and selection are one of the most important processes in any organization
as it helps in finding and selecting qualified and skilled personnel for the company as per the
needs of the vacant position (Klikauer, 2019). The recruitment process helps in attracting
the candidates towards a job and stimulating them to apply for the same. The selection
9

procedure is focused on choosing the right applicant for the available position after
considering tests, interviews, reference checks and medical examination before selecting
the candidate (Klikauer, 2019).
DEVELOPMENT AND TRAINING
The training and development programme within an organization is aimed at improving the
effectiveness and productivity of the employees by providing them adequate training with
the help of various on-the-job and off-the-job training method that helps the employees in
understanding the nature of the work and thus, they are able to perform better. The
development programmes refocused on increasing the skills and abilities of the employee
by providing them recognition, appraisals and incentives which help in boosting their morale
and thus, enhance their productivity (Sparrow and Otaye-Ebede, 2017).
PERFORMANCE MANAGEMENT
The performance management system starts with defining the job to the employee and
ends when an employee leaves the company. This system helps in creating a peaceful
working environment for the employees so that they are able to perform utilizing the best
of their capabilities and thus, achieving the desired goals of the business effectively and
efficiently (Sparrow and Otaye-Ebede, 2017).
REWARD SYSTEM
The reward system in an organization attracts and motivates the employees to give their
best to the organization and achieve its goals. The employees are provided with the help of
positive and negative rewards that help in motivating the employees to improve their
performance (Sparrow and Otaye-Ebede, 2017). The positive rewards comprise of
incentives, bonus and allowances, recognition and appraisals whereas the negative reward
includes punishments.
STRENGTH AND WEAKNESSES OF METHODS INVOLVED IN RECRUITMENT AND SELECTION
Recruitment and selection approach in ALDI: There are two basic approaches to
recruitment and selection in Aldi which have their own strength and weaknesses. These two
approaches include internal and external sources of recruitment (Klikauer, 2019).
10

STRENGTHS OF INTERNAL RECRUITMENT
The internal source of recruitment in Aldi can be done through promotions and transfers.
This is a cheap process and provides many benefits to the company such as it helps the
employers in increasing the motivation of the existing employees and maintaining good
relations with them and they are habitual to the existing procedures, thus, it becomes easy
for the employees to adjust in the organization (Machado, 2016).
WEAKNESSES OF INTERNAL RECRUITMENT
There are certain limitations when it comes to recruiting employees through internal
sources as there is a limited choice with the HR team to select an applicant for the vacant
position and this leads to introduction of no new ideas and innovations into business and
the employees with adequate skill and talent may not get selected (Machado, 2016).
STRENGTHS OF EXTERNAL RECRUITMENT: The external recruitment procedure in ALDI is
quite effective as in help in:
Hiring skilled and talented workforce: Talented pool of applicants can be recruited with the
help of various methods like campus recruitment, recommendations, advertising, etc.
(Savino, 2016).
An increasing number of innovative ideas: new and fresh talent selected in the ALDI can
help in bringing innovative ideas into the business that would lead to change in the existing
styles and systems of the company and help in increasing effectiveness.
High level of competition: When the HR team of ALDI selects candidates from outside the
firm, the existing employees feel a sense of competition from the new employees which
increases their productivity and they try to perform better than the new employees (Savino,
2016).
WEAKNESSES OF EXTERNAL RECRUITMENT:
Expensive and time-consuming process: The process of recruitment and selection in the
ALDI is very lengthy and time taking as it involves various levels such as tests, interviews,
examinations, etc. before selecting a candidate (Savino, 2016).
11

Demoralization of existing employees: The existing employees of Aldi feel demotivated
when new employees are hired in the organization as they feel that they could have been
promoted or transferred to fill the position which leads to inefficiency in their performance.
Lack of cooperation: The existing employees of the company do not work with cooperation
with the new employees which affects the success of the ALDI (Savino, 2016).
12