Analysis of Managing Information and Technology in ALDI: A Report

This report provides an in-depth analysis of ALDI's use of information technology and its impact on business processes and competitive positioning. It begins with an introduction to ALDI, its background, and the products and services it offers. The report then applies Porter's Five Forces model to analyze the competitive landscape of the UK supermarket sector, followed by a value chain analysis to identify key activities. The report examines inbound and outbound logistics, operations, technological development, and procurement. It also highlights key value-adding activities and discusses how ALDI could deploy IT and innovative ideas to improve its business processes and enhance its competitive advantage. The analysis covers human resource management and technological advancement. The report concludes with a summary of findings and recommendations.

Managing Information
and Technology in
ALDI

Table of Contents
INTRODUCTION...........................................................................................................................2
MAIN BODY...................................................................................................................................2
Introduction of ALDI..................................................................................................................2
Back ground of ALDI ...............................................................................................................2
Products and services of ALDI ..................................................................................................2
Porter’s 5 Force...........................................................................................................................3
Value Chain analysis of ALDI...................................................................................................4
Two support activities in Porter's value chain of ALDI.............................................................5
Identify key value adding activities of ALDI ...........................................................................6
Summarise & reflect on how the business could deploy information technology (IT) and use
innovative ideas to improve its business processes and to enhance its competitive positioning
.....................................................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8
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INTRODUCTION
Information technology play very essential role in order to perform the whole business
functionality in a successful manner so that they will be able to beat the competition level. In
order to gain competitive advantages at the marketplace, it is required by the business entity to
have sufficient amount of resources which includes computer software, various networking
facilities and many more (Baxter, 2019)(Carvalho and Nobre, 2019)(Chalaby, 2019)(Chlopecký
and et. al., 2019)(Cordell and Thompson, 2019)(Culot and et. al., 2019)(Julita and Arianty, 2017)
(Lloyd, 2017)(Mudambi and Puck, 2016)(Stein and Barron, 2017). In the present report, ALDI
is chosen as the base organisation which was founded by Karl & Theo Albrecht in the year 1913.
In the report, different sections are going to be included where competitors analysis is discussed
with the help of Porter's Five force model and value chain analysis is done so that level of
changes can be identified in an effective manner.
MAIN BODY
Introduction of ALDI
ALDI is a common brand which is a discount supermarket chain in more than 20
countries where they have approximately 10,000 stores. It is a Germany based organisation,
founded by two brothers when they take over their mother's store. It has been said that ALDI
operates its business functions in around 3000 stores until year 1990. Apart from the vast number
of supermarket chains across the whole wide world, ALDI is an organisation which maintain
their position by providing large number of products and services.
Back ground of ALDI
ALDI was founded by two brother Karl & Theo Albrecht in the year 1946 when they take
over their parental company in Essen. Later on the business was divided into two main groups in
the year 1960 which later became ALDI Sud headquarter in Mulheim and the other one is ALDI
Nord headquarter in Essen (Carvalho and Nobre, 2019). In 1962 it was introduced by the name
ALDI. Company generally operates its business functions in Ireland, Switzerland, China, Italy,
Spain and many other countries.
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Products and services of ALDI
ALDI is an German based supermarket chain deals in grocery items so that they can
satisfy the needs and wants to customers in an appropriate manner. The main focus of the
company is on no frills shopping experience where almost 90% of the companies product are
sold from its own brand line(Chalaby, 2019). ALDI is a company provide ample number of
groceries and household essential to their customers which are of high quality and fulfil there
needs and wants.
Porter’s 5 Force
It has been analysed that in the present era, UK supermarket sector is one of the most
competitive industry as it includes large number of rivalry companies at the marketplace. In
order to develop business operations in an effective manner, it is very essential for the
organisation to to increase there understanding about the companies. In the present context of
ALDI, Porter's five force model is used by the managers in order to examine various aspects in
an effective manner. All the factors are going to discussed in a detail manner are as follows:
Bargaining Power of Buyers (High): The impact of this element defined as high in
reference to ALDI. Reason behind this is that there are ample number of supermarket chain
present at UK offered almost same kind of goods and services to there customers within same
price. It simply define as the bargaining power of purchaser is quite high as if customers refuse
to buy ALDI products due to any reason it might affect the overall performance of the
organisation at the competitive marketplace (Baxter, 2019). On the other hand, for overcoming
such situation it is required by ALDI to purchase new schemes, policies and methods so that they
can retain their customers for a long duration of time period.
Bargaining Power of Suppliers (Low): It is said that suppliers are those person who
give raw materials to the organisation in order to produce high quality goods and services and
sold it at the competitive marketplace. In the present context of ALDI, it has been analysed that
the bargaining power of suppliers are quite low as there are ample number of companies deal in
similar sector and requires same quality raw material. On the other hand, if managers of ALDI
give some quotations and suppliers do not get agree on the same then the company have option
to move towards another option. Therefore, it is requires by the suppliers to agree on quotations
provided by the managers so that they can increase there profitability at the marketplace
(Chlopecký and et. al., 2019).
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Threat of new entrants (Moderate): New entrants refers to the one who mainly enter
into the marketplace so that they can develop their position at the marketplace. In the present
context of supermarket sector, it is quite difficult for new organisations to enter new marketplace
so that they can perform their operations in an effective manner. It has been analysed that the
major reason is that it requires huge capital in order to perform their business functions in an
effective manner. Hence, it is said that threat of new entry in context of ALDI is quite moderate
as company having very positive brand image at the marketplace (Cordell and Thompson, 2019).
Threat of substitutes (High): It is said that supermarket sector includes lot of substitutes
available at the marketplace which affect the sales performance of the company at the
competitive marketplace. In the present context of ALDI, there are large number of other
organisations available at the market which provides similar products and services to their
customers. For tackle such situations in an effective manner, it is said that ALDI need to conduct
regular basis market research so that they can develop goods and services according to the
changing needs. This as a result aid them in order to formulating new goods as per the needs and
manage their state at the marketplace.
Competitive rivalry (High): Competition within this sector is quite high and dense and
the reason behind this is that there are ample number of organisations deals in the marketplace
which belongs to same sector. Some of these organisations includes, ASDA, Lidi, TESCO,
Sainsbury's, and many more. It has been analysed that all these business entities have large
number of customers who are loyal towards the organisation and assist them in order to attain
their goals and objectives in an effective manner (Culot and et. al., 2019). In order to reduce such
competition, it is required by the company to merge with other rival companies so that they can
reduce the level of competition. With the help of this, ALDI will be able to beat the competition
and perform their business functions for a longer period of time.
Value Chain analysis of ALDI
Value chain analysis includes both primary as well as secondary activities which are
going to be discussed in detail as follows:
 Inbound Logistics: This is the first activity in primary section where it is required to
develop strong relationship with raw material suppliers. With the help of positive
relationship with suppliers help in removing delay in the production process. For ALDI,
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it is very essential to examine inbound logistics as it assist in examining the challenges
faced by them while producing goods and services (Julita and Arianty, 2017).
 Operations: It is the section where raw materials are converted into goods and this is the
activity which is started only when company have raw material. In the present context of
ALDI, some of the activities includes in this section is assembling of products, testing,
packaging and many more. Continuous analysis of these activities help the company in
order to enhance their productivity as well as performance at the competitive
marketplace.
 Outbound logistics: The outbound logistics includes all those activities which assist in
making the products and services available for the customer. In the present context of
ALDI, some of the activities includes in this section are handling raw material,
transportation, scheduling and many more. Along with this, cost as well as time needs to
be manage by the managers so that they gain maximum results (Lloyd, 2017).
The supporting activities which are related with ALDI are going to be discussed as follows:
 Technological development: It is one of the most essential activity which help an
organisation in gaining competitive advantages at the marketplace. In the present
context of ALDI, managers of the company use various advance technologies while
producing goods and services along with selling them to the customers. In this section,
research and development is also included which help in enhancing the goodwill of
organisation at the marketplace.
 Procurement: The procurement includes different types of funds, raw material,
technology as well as equipments which assist in producing goods at the competitive
marketplace. In the present context of ALDI, managers of the company need to manage
all the cost and inbound as well as outbound logistics needs to be manage in an effective
manner (Mudambi and Puck, 2016).
Two support activities in Porter's value chain of ALDI
In the present context of ALDI, support activities are human resource management,
procurement, technological development and many more. Therefore it is very essential for the
manage to use it in an effective manner so that they gain competitive advantages. Some of these
support activities are going to be discussed as follows:
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 Human Resources Management: It includes all those factors which includes selection,
recruitment, training as well as development session of workforce so that there
efficiency will be increased. In the present context of ALDI, managers of the company
gives training and development sessions to their staff members so that they can develop
high quality goods and services which help in enhancing the sales and profitability of
the company (Stein and Barron, 2017). This as a result provide various advantages to
the customers by producing high quality goods and services.
 Technological Advancement: In today's competitive environment, technological
development refers to one of the most essential element which help in producing high
quality goods and services. In the present context of ALDI, it is said that in order to gain
competitive advantages managers adopt, information technology so that they can attract
large number of customers towards their organisation. With the help of this, dynamic
and changing needs and requirements of customers will be fulfilled in an effective
manner.
Identify key value adding activities of ALDI
Value chain is an essential framework provides base of decision making to the business
organisation. Their major focus is to use resources at it best and accomplish organisational goals
and objectives of ALDI. Management team of ALDI emphasis on effective supply chain which
help in enhancing the productivity and profitability of the company (Baxter, 2019). Along with
this, it has also been said that the company gain competitive advantage with the help of
enhancing the experience of customers with the help of providing training sessions to their staff
members.
Summarise & reflect on how the business could deploy information technology (IT) and use
innovative ideas to improve its business processes and to enhance its competitive
positioning
Information technology sector is emerging now a days and has covered most of the
market share growth. Many corporation as well as companies are now converting and taking new
approaches to IT sector. People has now become addicted to technology because it simplify
human work. Thus, it is an emerging sector ALDI should use digital platforms and online
management system to boost up their business and rise in this competitive market (Carvalho and
Nobre, 2019).
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They can enhance their business online and promote themselves through social media
platform such as Facebook, Instagram etc. With assist of these digital platform, product
awareness of their brand will be spread across the globe. Implementing of new technologies and
being advanced can increase their profit and sales revenue of their business. Adopting
Information technology in ALDI will trigger organisation to achieve goals and objectives with
given period of time and cost. Also, credentials and data related to business as well as entity can
be secured with use of high security approaches and tools. ALDI can use IT as a source to gain
revenue.
Also, ALDI can perform multitasking functions with appropriate use of it software and
equipments. Adoption of digitalisation by ALDI has acquired a total satisfaction in context to
employees, workers and customers. Company has expanded its grocery stores and supermarkets
stores with strong network of distribution channels (Chalaby, 2019). Also, ALDI is deciding to
establish more new stores and markets to be ahead and competitive in market by providing
customer reward cards with points claimed through their website. So, IT sector is the main
reason/source for overall development of entities and business. Assist of IT has reduced
transportation cost and cost of production in ALDI. It underpin company to be advanced and
active amongst the business.
CONCLUSION
With the help of above analysis, it has been concluded that information technology plays
very essential role in order to gain competitive advantages at the marketplace. With the help of
adopting latest technology or by using IT for doping there business functions in an effective
manner. By using information technology, company will be able to attract large number of
customers towards their organisation so that they can beat the competition at the marketplace.
With the help of Porter's Five force model, management team of the company will be able to
know their competitors available at the marketplace and develop strategies according to the
requirement.
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REFERENCES
Books and Journals
Baxter, G., 2019. A strategic analysis of Cargolux Airlines International position in the global air
cargo supply chain using Porter’s Five Forces Model. Infrastructures. 4(1). p.6.
Carvalho, J. and Nobre, P.J., 2019. Five-factor model of personality and sexual aggression.
International journal of offender therapy and comparative criminology. 63(5). pp.797-
814.
Chalaby, J.K., 2019. Outsourcing in the UK television industry: A global value chain analysis.
Communication Theory. 29(2). pp.169-190.
Chlopecký, J. and et. al., 2019. External Analysis for the Purpose of Strategic Decision-Making
of Heating Company.
Cordell, A. and Thompson, I., 2019. The Procurement Models Handbook. Routledge.
Culot, G. and et. al., 2019. Integration and scale in the context of Industry 4.0: The evolving
shapes of manufacturing value chains. IEEE Engineering Management Review. 47(1).
pp.45-51.
Julita, U.M.S.U. and Arianty, N., 2017. Porter’s Five Force Model For Superiority Of Micro
Small And Medium Enterprises (Sme’s) In Face The Asean Economic Communiy
(Mea). KUMPULAN JURNAL DOSEN UNIVERSITAS MUHAMMADIYAH
SUMATERA UTARA. 4(2).
Lloyd, I.J., 2017. Information technology law. Oxford University Press.
Mudambi, R. and Puck, J., 2016. A global value chain analysis of the ‘regional
strategy’perspective. Journal of Management Studies. 53(6). pp.1076-1093.
Stein, C. and Barron, J., 2017. Mapping actors along value chains: Integrating visual network
research and participatory statistics into value chain analysis (Vol. 5). International
Water Management Institute (IWMI). CGIAR Research Program on Water, Land and
Ecosystems (WLE).
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