Critical Analysis: Human Resource Management at Aldi UK

This essay provides a comprehensive analysis of Aldi UK's human resource management (HRM) practices. It begins with an introduction to Aldi's global presence and its focus on quality and competitive pricing. The essay then delves into the nature and characteristics of HRM, exploring how Aldi aligns its HRM with its strategic goals, particularly in the UK market. It examines Aldi's people management strategies, including recruitment, training, development, and performance management, highlighting how these strategies contribute to its competitive advantage. The essay also discusses the organizational implications and contributions of HRM in practice, such as the implementation of self-directed work teams and knowledge management systems. Furthermore, it addresses some of the problems faced by Aldi in its HRM, such as employee complaints regarding job security and working conditions, and presents the company's responses to these issues. The essay concludes by emphasizing the importance of aligning employee and company goals to achieve continued success and competitive advantage in the market.

Managing people: Aldi, UK

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Introduction: The modern environment of operation for the organizations is highly
dynamic and is constantly changing. According to this change, the companies keep
changing their policies, rules, and processes. It means that if a company has to survive,
remain relevant and be competitive, it has to develop strategic plans. With the
introduction of various strategies in the company, the functioning of various departments
gets affected. One such department getting majorly affected by these plans is a human
resource. In this essay, critical examination of Aldi, UK human resource management,
various functions of human resources, and key principles of human resources will be
discussed. How the human resources functions help ALDI, in gaining competitive
advantage will also be discussed. This essay will cover the nature and characteristics of
HRM, Aldi UK people management strategies, procedures, and tools. The current trends
and patterns of the Aldi UK will also be discussed. In the end, the conclusion will be
drawn.
Human Resource Management: Company profile: Aldi is a global retailer in food
segment and it started its operation in 1913. It is a reputable retailer, operating in various
countries like USA, Germany, Australia, and the UK. It has more than 7000 outlets and
stores internationally. Aldi is ahead of its competitors because it provides quality
products to its consumers by operating a competitive pricing strategy. The company is a
flat organization and in the UK it is split into 5 regions, where every region operates at
an individual level (Loewer, 2013). There are only 3 levels between the MD of the region
and the store assistants. Quality, service, and quality are the main three focuses of ALDI,
UK. This makes it important for the HR of the company to attract and select those people
who possess right skills, abilities, knowledge, and attitude. It is essential for the HR
manager to employ an Area manager for the company who would qualify and fit in the
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business, as area managers hold a crucial role in the operation of the company. It is the
job of the Area manager to have a complete control of the stores, by motivating their
subordinates and inculcating the culture of the company into them.
HRM Nature and characteristics: The understanding and application of those policies
and procedures which directly affects the workforce of Aldi, UK is known for its human
resource management. It is very crucial for the company to remain in the business, by
hiring and retaining qualified and knowledgeable staff at all levels. It can also be defined
as a coherent and strategic approach to the ALDI’s working force management on an
individual and collective level, which will ultimately lead to the achievement of the
objectives (Ruddick, 2015). Basically, HRM is a part of a management process, so it
draws the principles, techniques, and concepts of management and apply it in the HRM.
All levels of the ALDI are permeated in the process of HRM. In the store operation
function of ALDI, there are only 2 HR Managers. The area managers of the company are
trained in HR and to deal with the issues related to recruitment to training and
development and performance management. The main HR manager of the company
makes sure that all Area Managers are up to date according to the policies and legislation
of the ALDI. The company has adopted a grandfather technique for its HRM, where the
store managers focus on the stores' operations and deal with employees and the line
manager reports to the Area Manager for the HR related issues (Rasel, 2015).
People are put in those jobs which are fit and apt for them according to their skills and
abilities so that they can yield results. The results produced are later compensated by the
ALDI, in the form of bonuses, incentives, and promotions. Aldi is a flat organization
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This function motivates the employees, to give their best to the company. With the help
of rational policies, the problems of employees are solved. The full potential of
employees is developed by imparting proper training and development programs on a
timely basis. The company makes sure that the employee’s talent is used in the
accomplishment of the goals. It is a performance oriented function which focuses on the
results. People are encouraged to give 100% and this helps the ALDI, in attaining a
competitive advantage over its competitors. By providing proper techniques and tools to
the workforce and managing them effectively, HRM is directed towards the achievement
of the goals of the company. To gain competitive advantage Aldi must manage its human
resource effectively and efficiently. More importantly, it should leverage its human
capital for achieving the strategic objectives of the business, which in turn can help the
company in gaining considerable success in the market (Mankad, 2015).
People management, strategies, and tools: Extreme focus is placed on productivity and
efficiency in ALDI, UK and due to this, the company is trialling using an HR agency in
the Neston Region of the country so that a major amount of company’s HR function can
be done. This agency performs all the HR function, like recruitment, induction,
development, payroll, etc. This helps the company in saving money, as Area managers
and Line managers can focus on their area of operations. In ALDI, the HR department is
aligned according to the strategic plans. This alignment between the HR, strategies, and
performance helps the HRM in developing a potential workforce and developing ALDI’s
competitive advantage. Every employee of the ALDI is promised a rewarding career,
where they will be provided an atmosphere and opportunities to develop and evolve as a
better professional. This motivates people to get committed towards their task and they
take ownership of their responsibilities (Shaw, 2007). ALDI’s focuses on three core areas,
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productivity, service, and quality. HR of the company recruits such people who have the
required skills, knowledge and abilities and are best suited for the required position.
More than 85% of the ALDI’s Directors are recruited from within the company, through
promotion. This shows that the company invests in training, development and reward
performance of the employees. With the constant training, employees are up to date and
succession plans are placed in all the stores. For example, if an assistant manager is sick,
deputy manager can perform the task in his absence. Line managers also play an
effective role in effectively delivering the strategy of the HRM. The responsibility of
translating the policies and plans into actions are given to the line managers. This helps
in sustaining a link between the corporate strategy, HR strategy, and organizational
performance (Group, 2018).
ALDI has developed training programs which are of high range and structures so that
employees can be trained to fulfil their assigned tasks. Managers are assigned the task of
motivating the employees, rewarding the employee who is performing excellently and
continuous improvement of the company. Training helps an organization in increasing
its business efficiency as well as also motivates the workforce by increasing the job
satisfaction. Training is only for the short-term purpose, but development program of
ALDI is meant for building the capabilities of the employees for a long duration of time.
The employees gain knowledge, learn new techniques and skills and a wide range of
attributes are developed. In this way, they can become adaptable according to the ever-
changing and dynamic market conditions and can take actions immediately (Loewer,
2013). Also, with the assessments and interviews, the Area managers identify the
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candidates who have precise competencies and skills in the openings. ALDI also imparts
training programs to young people known as apprentice scheme. This is an on-the-job
and off-the-job training program. Another training program of the company is Retail
Apprenticeship.
To leverage the human capital of the company and attain the competitive advantage
various strategies and tactics are implemented by the company. The company competes
in the market by offering lower prices. ALDI make sure that the operational expenses are
kept as low as possible so that the profit can be maximized. This is done by deriving the
human capital from a pool independent contractor. Lucrative ideas can be yielded by a
variety of perspectives in respect of product differentiation. ALDI, allows the employees
to take part in short-term training and projects according to their interest. A superior
product can be offered to the customers by the highly skilled employees. Companies like
ALDI, compete on the basis of the quality of products and services. It can cost to the
company to invest in the training and retention of the highly skilled employees, but it can
be passed to the consumer in the form of premium pricing. Another source of ALDI’s
competitive advantage is operational effectiveness. Operating margins can be increased
by a skilled employee who knows how to reduce the internal costs. Due to the strong
culture prevailing in the company can boost the morale of the employees and
engagement, which in turn leads to the rise in productivity and in the end leads to a
rising in the profits (Mayhew, 2017).
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Organizational implications and contributions of HRM in practice: The self-directed
work team is implemented by the company by the HR, where members are aware of their
roles and responsibilities. They work as a team to fulfil the company’s objectives. This
ultimately helps the company management in reducing the time required to micromanage
each unit. Without the external supervision, the component units run smoothly in the
company (Leeming, 2015). The HRM also makes ensure that ALDI possesses a
knowledge management system, where every employee is able to gain and share the
available knowledge. The company also implements soft sell motivational strategies and
hard sell strategies. In soft sells, individuals are advised and praised, whereas in the hard
sell, incentives and promotion within the company are done (Rodionova, 2017). These
two strategies are used by the ALDI, for the regular performance appraisal and giving
rewards. Successful employees are provided further training and later are promoted. The
workers of the company are highly empowered, motivated and well trained. The strategy
of the HR is that company’s strategies are executed properly by the employees and they
help the company in delivering the desired results. Detailed and clear job descriptions
are produced ALDI so that people with the right skills can be hired (Harry, 2016).
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Problems faced by the ALDI: In the past few years, the companies have faced few
issues related to its HRM. Few of the ALDI’s employees have accused the company of
job security and job satisfaction. But the company has responded to this accusation by
saying that it is providing a great ambiance to its workers to work and grow personally
and professionally. One ex-manager complained regarding facing discrimination at the
workplace because he was HIV positive. He accused his seniors of asking him to leave
the job (Jefferson, 2015). Also, complaints about the long working hours, work-life
imbalance, late shift changes, poor health and safety and unrealistic productivity targets
assignments have been made by the employees. In response to this, the HR of ALDI said
that every employee of the company is keen for the opportunity where they are
guaranteed for additional hours and additional income can be earned. The limit is for 38
hours plus. The company also claims to be one of the supermarkets who offer highest
hourly rates and active feedback from the employees (Rahman, 2018).
Conclusion: ADLI make sure that its customers get the quality products at competitive
prices. It also believes in operational efficiency, for which it has employed skilled and
competent staff. In the UK alone, ALDI is expanding and making progress in the market.
New stores are being opened and due to the rise in sales, more staff needs to be hired. It
is the time for the company to introduce a robust selection and recruitment process and
policies. To achieve competitive advantage, it is essential the goals of the employees and
the company are aligned into one. This is the job of the HRM, to hire skilled people and
train them into much better work personal. The company provides various kinds of
training and development programs. Too much emphasis is put on the training of people.
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To conclude, the company treats its employees as valuable assets. Empowerment,
authority, and personal responsibility are provided to the employees. This helps in
motivating the employees in working towards achieving the organizational goals and
ultimately leading to competitive advantage.
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References
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