Human Resource Management Report: HRM and Workforce Planning at Aldi

This report provides a comprehensive analysis of Human Resource Management (HRM) practices, focusing on workforce planning, recruitment and selection, employee relations, and the impact of HRM decisions, with a specific case study of Aldi. The report explores the purpose and functions of HRM, including orientation, recruitment, and training. It also examines the strengths and weaknesses of different recruitment approaches, internal versus external hiring, and the benefits of various HRM practices for both employers and employees, such as compensation, training, and development. Furthermore, the report investigates employee legislation, its impact on HRM decision-making, and the importance of employee relations within an organization. The report is structured into tasks, each addressing key aspects of HRM, and includes a conclusion summarizing the main findings.

Human Resource
management

Table of Contents
PART 1............................................................................................................................................1
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Purpose and functions of HRM applicable to workforce planning...................................1
P2 Strengths and weaknesses of different approaches of recruitment and selection.............2
M1....................................................................................................................................................4
M2....................................................................................................................................................4
D1.....................................................................................................................................................5
TASK 2............................................................................................................................................5
P3 Benefits of different HRM practices for both the employer and employee......................5
P4 Effectiveness of HRM practices........................................................................................6
M3....................................................................................................................................................8
D2...........................................................................................................................................8
TASK 3............................................................................................................................................8
P5 Importance of employee relations.....................................................................................8
P6 Key elements of employee legislation and its impact on HRM decision making.............9
M4.........................................................................................................................................11
PART 2..........................................................................................................................................11
INTRODUCTION.........................................................................................................................11
TASK 4..........................................................................................................................................11
P7 HRM practices in an enterprise and its application........................................................11
M5.........................................................................................................................................14
D3.........................................................................................................................................14
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

PART 1
INTRODUCTION
Human resource management is a system which is designed by management of
organisation which deals with managing, staffing, directing, administering, compensation and
reward system, selecting new candidates etc. It is crucial for company to have efficient human
resource management system to stay ahead of their competitors. Proper management resources
and people leads to achieve desired success for company. Aldi is a retail firm, selected in the
present report which was found in the year 1913 and its headquarters are situated in Essen and
Mulheim, Germany. This assignment mainly focuses on purpose and scope of human resource
management which are applicable in workforce planning. Strengths and weakness of different
approaches with effectiveness of HRM practices are provided in this assignment. It also consists
of employment legislations and its impact on decision making. In additional, application of HRM
practices related to work has also been described.
TASK 1
P1 Purpose and functions of HRM applicable to workforce planning.
Aldi is one of the leading company which is operating in different states of United
Kingdom with a large number of stores. It has a large working force which is employed in Aldi
on regular basis. It is necessary for company to manage their workforce efficiently. For that
management should establish an effective Human Resource Management.
As mentioned above, HRM deals in managing people and perform other functions like
hiring, recruiting, selecting, performance and change management, retirements, risk management
etc. To make HRM best for the company, than above functions should be carefully and properly
executed by managers.
Various strategic plans are designed by top level managements to accomplish their
desired sets of goal and objectives (Keep and James, 2010). Different functions of HRM which
are performed by managers in Aldi are mentioned below:
Orientation: Events such as induction or orientation program should be organised by
every company to make new candidates comfortable. When any employee joins a company, at
that time they are not aware about working culture, rules, regulation, standards, policies of
organisation. These events provide them with relevant information about duties and
1

responsibilities towards their job and company. Aldi organises such programs to clarify all
doubts and problems of new joiners.
Recruitment and selection: This process include hiring and selecting talented candidates
which suit a particular job position available in company. Aldi's HR manager first identifies
available job positions within organisation and list down all characters and skills which should
be present in a candidate and start their hiring process according to specifications. Main aim of
every company is to attract skilled employees towards them. With the support of talented staff,
Aldi can achieve their goals in better way and within time limit.
Managing employee relations: Employee is a critical part of an organisation. Managing
balanced relations among employee is necessary for such a large organisation to achieve their
vision and missions. Aldi's managers can organise different events to know behaviour of
employees and their expectations from company (Cordner and Cordner, 2011). These activities
promote a healthy environment and employees will feel satisfied. If employees are satisfied with
working environment of firm, they will automatically perform best in their tasks which will
ultimately benefit company and employees also. Managers give various rewards to best
performers and motivate others to work hard.
Training and development: It is a critical function of human resource management.
Company give training to those employees who lacks particular skills or they are unable to
perform their task smoothly. Their aim for providing training is to enhance skills and knowledge
about that particular task as well as ensure smooth working by employees. It helps in building
confidence and attitude, and also promotes all round development of employees (Rees and
Rumbles, 2010). Training can also be given to existing employees who are not aware of new
advancement in technologies and new ways to perform a particular task.
Above were some important HRM function, that are performed by managers of Aldi to
enhance the capabilities and capacity of their employees so that they can work smoothly to
achieve desired goals. HRM helps organisation and employees to work together in same
direction to achieve its main aim.
P2 Strengths and weaknesses of different approaches of recruitment and selection.
Recruitment and selection are critical functions of any organisation and it should be fair
enough to give equal chances to every candidate applying for a job position (Taylor, 2014).
Recruitment is mainly concerned with attracting, short-listing and appointing suitable candidates
2

whereas selection is concerned with interviewing and evaluation candidates for a particular job
position in an organisation. Recruitment is a positive process whereas selection is a negative
process.
There are two sources where manager can hire suitable candidates and those sources are
mentioned below:
External sources: Manager use this source to hire candidates from outside the company. It
mainly include - advertisements, employment exchange, placement agencies, campus interview
walk in interviews and competitors.
Advantages of external sources:
 Inflow of fresh talents.
 Hiring of best candidate for a particular job position.
 Fresh talent give new and different and innovative ideas.
Disadvantages of external sources:
 Recruiting externally sometime become expensive for company.
 Managers are not able to retain talented employees as they keep on switching jobs.
Internal sources: This source enable hiring of employee from inside the organisation. This is
used when company lacks finances to perform external recruitment (McGraw, 2013). It include-
transfer, promotions and present employees. Transfer is defined as shifting employees from
present job to other similar or different job whereas promotion means increment from current
position to higher position. Promotions increases current pay as well as in status of that
employee. Present employee who are concerned are informed about likely vacant positions.
Advantages of internal sources:
 Enhance overall development of employees working in an organisation.
 It increases morale level of employees.
 It promotes loyalty in employees.
Disadvantages of internal sources:
 It limits the opportunities for capable person to enter in organisation from outside.
 It discourages flow of fresh talents and new ideas.
Above are the two main sources which is used by Aldi to hire skilled candidates for a suitable
job positions. Below are the strengths and weaknesses of recruitment and selection.
Strength of approaches to recruitment and selection:
3

Recruitment is a fundamental process which helps in attracting new people towards their
company and manager hires the best suitable candidate for its company (Board, 2017). Talented
employees ensures company to achieve its vision in more effective manner. Some of the strength
are mentioned below:
 Hiring of new and fresh candidates.
 Inflow of new ideas.
 Improvement in working culture of organisation.
 Recruitment of talented and skilled employees.
 Maximisation of revenue and profits of organisation.
 Recruitment helps in better assessment of candidates which suits a particular job
position.
 Internal hiring of employees are cost effective process for the company.
 Skilled employees reduces cost of training and development.
Weakness of approaches to recruitment and selection:
Though recruitment have various strengths but it also have some weaknesses. They are
described below:
 Company should formulate effective and fair recruitment system.
 Old employees may feel unsatisfied from new employees.
 Jack system enable managers to hire wrong candidates.
M1
HRM functions are necessary for an organisation to implement those within firm so as to
enhance abilities and talents of employees. With the help of those skills, employees can perform
their task in better manner and can generate good outputs and profits for company. If an
organisation have highly talented staff, them it can go far ahead in market and can achieve their
business objectives more effectively and efficiently.
M2
As described above, recruitment and selection are critical process for a company.
Strength of recruitment and selection process is that, it provide with best suitable candidates for a
particular job positions to company. Talented employees work hard to achieve desired goals.
4

Weakness of this process is that, due to lack of financial support, managers are unable to go for
external recruitment and they have to hire from inside the organisation.
D1
According to (Bryson, James and Keep, 2013), in case of hiring employees, manager can
go for both internal and external recruitment. In external hiring, managers finds out fresh talents
with new ideas which can benefit the company but in internal hiring, managers are unable to find
new talents.
TASK 2
P3 Benefits of different HRM practices for both the employer and employee.
Human Resource Management practices are necessary to implement within organisation
to ensure effective working by staff members. Good practices should be generated and designed
in such a manner so that company can achieve their goals (Garner, 2012). In Aldi, leaders and
managers implement effective HRM practices among members of company to ensure proper
functioning.
HRM practices for employer are:
Hiring of candidates: It is one of the major responsibility of employer as they are chiefly
concerned with hiring and selecting best candidate for a suitable job post. Recruitment can be
done through internal and external sources which ensures inflow of different type of candidates
with different skills and talent within organisation.
Benefits of hiring candidates are:
 New candidates provide with new ideas and opinions.
 Maximising company's output.
 Suitable candidates can be hired from within the organisation. Achieving goal and objective become more effective.
Training of candidates: For improvement of skills and capabilities of new candidates as well as
existing employees, necessary training is provided to them (Boxall and Purcell, 2011). It
enhances confidence and motivation level and promote better functioning of employees after
training. It also help in competing with other candidates.
Benefits of training of candidates are:
 It enhances motivation and satisfaction level of employees.
5

 Improves desired skill required for performing a job.
 Effective performance by candidates.
HRM practices for employee are:
Compensation and benefits: Compensation are those benefits which are given to employees at
the time of good performance. There are three types of compensation and are as follows: Direct financial compensation: In this, employees receive pay in form of salary, wages,
bonuses and commissions given at fixed and irregular intervals. Indirect financial compensation: Other financial rewards which are not included in direct
compensation. Components included in this are – leaves, benefits, retirement plans etc.
 Non- financial compensation: It include career development and advancement
opportunities, work environment and conditions as well as opportunities for recognition.
There are some direct and indirect benefits which are provided to employees at some interval of
time. In this health benefits, life insurances, retirement benefits, sick and casual leaves, etc., are
included in direct benefits. Indirect benefits include non monetary benefits such as pension
funds, company cars, overtime pay, annual leave etc.
Training and development: Manager identifies those employees which are in need of training
and provide them with suitable training. It enhances skills to perform a current job and is helpful
in future also. With proper training, employee can improve their knowledge which may required
to perform their respective jobs (Armstrong and Taylor, 2014). Sometimes, existing employees
also require training because they are not aware about recent advancement in procedure as well
as in technology. Better training can be provide to them, that will improve their productivity.
P4 Effectiveness of HRM practices
Among various vital factors that contributes in the accomplishing a company's
objectives, missions and goals is a highly proficient, dedicated and motivated workforce.
Employees are considered as the backbone of an organization who enables a business to have an
edge over its competitors by utilizing their talents,skills and knowledge to get maximum
outcome giving higher profits. Therefore, retaining talented employee becomes crucially
important for a company because the services provided by satisfied professional,having high
morale towards company cannot be substituted by any other worker. A business firm by applying
various HRM practices try to formulate strategies and programs that are aimed towards
providing job satisfaction to its employees. Thus, it becomes the prime responsibility of a HR
6

manager to develop strategies and practices with alignment to proper leadership and
administrative approaches and prepare various training and development programs, payment and
reward mechanism etc. which helps an employee to enhance their skills and knowledge making
them capable of meeting up their current as well as future job requirements besides providing
them with satisfaction related to their job and career growth. Aldi being one of the world's
leading companies in discounted supermarkets strives to work towards providing best shopping
experience to its clients. It recognizes the fact that a self satisfied and dedicated employee is a
key component to attain customer satisfaction and to get advantages of well coordinated,
committed and skilled team over its competitor. In this reference, practices associated with HR
becomes a critical factor for generating creative ideas & innovation that can attract the
customers. Some of these practices that can be considered are :-
Recruitment and Selection: Recruitment and Selection are the first and foremost
processes that are significant for an organization for its success as these practices make sure
that an organization has right person at right job at right time. Selecting and recruiting the most
suitable person for a post assists the management to make perfect alignment of organization's
mission, vision with its goals and making strategies for achieving them within specific.
Measuring performance: It is one of the most important practices which focuses on
measuring the work efficiency of an employee as company spends a huge amount of its budget
on their training and development. Aldi managers significantly make use of this practice and
together with the employees plan, review and evaluate their performance to ensure that they are
successfully achieving company's goals along with their own personal goals.
Payment & Reward Management:- Payment & Reward Management consists of
forming and applying policies, procedures and strategies to ensure that an employee should get
rewarded from management in return for his service and contribution in an organization. It can
be monetary rewards such as salary hike, bonus etc. or non monetary rewards like promotion etc.
This practices acts as a motivating tool for employees to perform with best of their abilities to
accomplish company's goals.
Training and development: It ensures that employees are well equipped and proficient
with the knowledge, skills and techniques that are requisite for them to perform their present
work & also prepares them for their future tasks. This practice will benefit Aldi in preparing
future mangers and leaders that are capable for taking higher level job & responsibilities.
7

Flexible working hours: Flexibility in job working hours has a two way benefit for
employees as well for the company. On one hand it helps in reducing stress level of workers and
helping them to maintaining work-life balance leading to improving their morale and
performance (Guest, 2011). On the other hand it will give benefit of better teamwork,productive
workforce reduced employee turnover etc. This HRM practice will be of great benefit for Aldi as
it will improve its employees morale & their commitment leading to higher productivity level
in addition to ensuring cordial relations between management & employees.
M3
As mentioned above, HRM practices should be effective enough to prevent risks and
threats which can influence company's profitability. For example: if manager hires a wrong
candidate which is not suitable for a particular position, then he will not be able to work in
desired manner and ultimately company will bear loss.
D2
HRM practices plays a major role in completing the routine tasks and activities
associated with an organization that ultimately contributes to timely and successful attainment of
ultimate organizational objectives (Jiang and Kand, 2012). It is a manager's task to formulate
appropriate strategies that will help the employees to develop their knowledge and skills which
are required for the completion of their present and future job.
TASK 3
P5 Importance of employee relations
Employees are the underline factors in the growth and success of an organization as they
are the source behind all the innovation, knowledge & creative ideas that a company generates.
Therefore the relations between employer and employee becomes the key factor in issues related
to employees performance,emerging conflicts and disputes, production capacity of firm etc. Thus
it is of uttermost importance for a firm to maintain mutual relationship of respect and trust
among its workforce and management. Managers of Aldi put consider efforts for building cordial
relations with its team so as to maintain satisfaction level of both parties i.e. management and
employees. For this they encourage its team members to be participative in decision making
process by giving ideas and feedbacks and to share their issues and concerns with the
management.
8

Timely achievement of set objectives : As business is a group activity there comes
certain issues and problems that cannot be solved individually by a manager. Taking right
decision therefore becomes crucial for such issues. Involving employees in decision making
process in such case can help the management to take quick and accurate decisions reducing the
lead time to achieve targets faster within the specific time (Wright and McMahan, 2011). By
doing so organization will get benefit of having new and innovative ideas to do a task and it
may happen that an employee can also highlight some essential points or details that might be
missed by the manager.
Reducing Conflicts & Disputes: When there is mutual understanding and coordination
among the workforce then people don't make perception about each others intension and tends to
ignore each others flaws. This leads to making employees to concentrate on their assigned tasks
thereby avoiding meaningless conflicts. Ultimately the end resultant shows an increase in
performance and productivity level of an employee.
Leads to increase in productivity : When employees are given happy and stress free
working environment where they feel motivated to be proactive and are involved in important
matters concerning company, it tends to trigger their zeal to work hard with best of their abilities
to attain organizational goals. They feel associated with the company which increase their morale
and loyalty towards the firm leading to less employee turnovers and reduction in absenteeism
rate. These all contributes in enhancing and increasing the productivity of the organization.
Profit maximization: With a well coordinated team of professionals who are self-
satisfied, motivated and loyal, Aldi will surely be able to be competitive with its business rivals,
by gaining customer's satisfaction and earning high profits. With high productivity level and high
demand for its goods and services Aldi will be able to capture large market share leading to an
increase in its goodwill and brand image.
P6 Key elements of employee legislation and its impact on HRM decision making
Every organisation must perform activities within the boundary of legislation created by
administrative body of its respective country. There are different levels at which government
operates such as federal, state, local in order to determine various aspects of HRM to grant
employee welfare. Therefore it is important for company to create their policies and procedures
as per laws and rules stated by government authorities (Berman and Mand, 2012). Aldi has been
9

performing its HRM practices as per legislation of UK in order to maintain law and order in
work place. Few employee legislations that are performed there are discussed below:
 Health and safety act 1974: Under this act numerous health and safety related act are
followed. Employer must provide its employees with healthy and safe working
environment according to the standards mentioned in legal documents. Ignorance in
practise of this particular act may lead company in defaulter stage.
 The National Minimum Wage Act 1998: According to this act employer is entitled to
pay its employee with some minimum amount which is fixed by government of UK. This
wage is calculated on the basis of service per hour i.e. amount which is fixed for one hour
of service. HR of Aldi makes sure if workers are getting their minimum wage as per act
or not.
 Family and Medical Leave Act, 1993: Government has provision for welfare of families
of people who are working as employees for any organisation with benefits such as
medical, education, etc. Employer provide insurance amount for families of employee
when they serve their work period. Aldi has provided its employees with benefits such as
education insurance, health insurance for their family members. Thus making HRM
practices more efficient and effective.
 Equity Act 2010: According to this act workplace is restricted to perform any unwanted
activities of discrimination. Discrimination can be made on the basis skin, caste, colour,
religion, sex and origin. In order to provide equality to every employee it is important to
ban such activities which can harm an employee mentally as well as physically. HR
manager of Aldi is bound to prevent its employees form any kind of discrimination that
can affect work culture of organisation. Data protection act- This act is formulated using Data Protection Directive 1995 in
order to protect employee, customers, investors information which an organisation holds.
It is used to maintain trust of investors and stakeholders who have invested in business
and prohibits trespassing of business or trading information.
10