Evaluating International HRM Strategies at Aldi Australia

This report provides an in-depth analysis of International Human Resource Management (IHRM) strategies within Aldi Australia. It begins with an overview of Aldi's background and current business operations in Australia, highlighting its mission, vision, and market position. The report discusses Aldi's HRM strategies, emphasizing the company's commitment to employee welfare, training, and development. It also examines the application of the resource-based theory in Aldi's HR practices, focusing on how these practices contribute to a sustainable competitive advantage. Furthermore, the report explores Aldi's employee relations and grievance handling mechanisms, showcasing the company's dedication to fair treatment and conflict resolution. The analysis concludes with recommendations for prospective HR strategies, aimed at further enhancing Aldi's HRM practices and ensuring continued success in the Australian retail market. This document is available on Desklib, a platform providing study tools and solved assignments for students.

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INTERNATIONAL HUMAN RESOURCE MANAGEMENT 1
Table of Contents
Introduction......................................................................................................................................2
Aldi’s Background Analysis........................................................................................................2
Aldi Australia- Current Business Operations..............................................................................4
Discussion........................................................................................................................................4
HRM Strategies within ALDI......................................................................................................4
Resource based theory in ALDI..................................................................................................5
Employee Training and Development in Aldi, Australia............................................................6
Aldi Employee Relations and Grievance Handling.....................................................................8
Conclusion.......................................................................................................................................9
Recommendations for Prospective HR Strategies.....................................................................10
References......................................................................................................................................12

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Introduction
Aldi’s Background Analysis
ALDI Einkauf GmbH & Co which is abbreviated as ALDI is recognized as a German
based retail enterprises executing its business operations across the world. The German based
retail business firm has been set up in 1948 by two indomitable brothers Theo and Karl
(Aldi.com.au 2018). The organization has efficiently expanded itself as one of the improved and
well-established environmental nutrient retail commercial business firm constituting around
7000 stores across the world. It has observed that Aldi in 2001 has initiated its business functions
in various developed countries like Australia, China, Austria, and Denmark and in the United
States (Chung 2016). Within Australia, the company operates its business as ‘Aldi Süd’ and has
been an ideal exemplification of a proficient procedure based retailer. Aldi functions chiefly as a
‘value for money’ retail enterprise primarily emphasizing on cost leadership and HR practices. In
addition to this, Aldi specializes within the domain of staple items along with daily economical
household items. Aldi Stores primarily functions a series of grocery stores in Australia and
provides a wide ranging offerings of baby care products, chocolate, coffee, skin care products
and other household items (Aldi.com.au 2018).
Alid Stores Supermarkets Pty Ltd identified as a foreign-owned classified enterprise
primarily functions in the superstore as well as grocery stores industry. The organization has
been headquartered in Minchinbury as well as New South Wales and has been operating solely
in Australia (Corporate.aldi.com.au 2018). Aldi Stores Supermarkets has been operating wide
ranging supermarkets as well as grocery stores in parts of Australia whereby the business
comprises of over 380 stores operating in New South Wales along with Australian Capital
Territory as well as Queensland and Victoria (Aldi.com.au 2018). In a very short span, Aldi has

INTERNATIONAL HUMAN RESOURCE MANAGEMENT 3
been positioned in the top 10 retailers in Australia. The company has further influenced several
grocery prices, enhanced the notions and perspectives as well as the excellence of label goods
with their own exclusive brands philosophy and has initiated a range of market-leading
endeavours which have not been experienced by the Australian retail sector (Chung 2016).
ALDI mission & vision statement
The primary mission at Aldi, Australia relies on providing incredibly exceptional and
high quality products at surprisingly economical price range. The company has been relentlessly
working to enhance the strategies and approaches through which they function in order to benefit
their employee base, customer range and local communities (Aldi.com.au 2018). Aldi has been
committed to sell only cage-free eggs in the next 5 years and firmly prohibit its suppliers from
using any animals for their products. Aldi furthermore has complied with the Australian
Livestock Processing Industry Animal Welfare Certification Scheme (AAWCS) that aims to
guarantee superior animal welfare activities (Corporate.aldi.com.au 2018). One of the primary
missions of Aldi in sourcing responsible tuna fish has been considered to be industry-dominated.
Aldi has been constantly developing its business model by employing comprehensive analysis
and further concentrating on fundamental areas (Aldi.com.au 2018). At the same time, Aldi has
persistently strived for well-established and competent solutions for the advantages of its
stakeholders.
Furthermore, in order to attain overall vision, Aldi Australia stands by certain values such
as:
 People- The core element to the success of the company which tends to stimulate the
achievement of the business (Chung 2016).
 Quality- Aldi efficiently purpose to provide quality excellent product and high quality of

INTERNATIONAL HUMAN RESOURCE MANAGEMENT 4
the services and work they offer.
 Simplicity- The Company competently drive efficiency as well as low cost business
model in order to sustain their economical price range and retain customers without
compromising in quality (Rao 2018).
Aldi Australia- Current Business Operations
Reports by Reynolds (2014) reveal that above 35% of Australian grocery purchaser
exhibit greater level of inclination towards Aldi that is a highly impressive statistic for a chain
with series of outlets located in three vital states. Aldi’s business practices has been immensely
successful in regions of Victoria and New South Wales with around 50% of each state’s grocery
purchasers in Aldi stores. Aldi shares of Victorian market since 2015 has witnessed a rise from
13% to 16.1%. While during the same time, Coles’ market share has declined from 36% to
below 30% whereas Woolworths has sustained its position at around 35% (Rao 2018). Aldi’s
current business practices have been structured as limited partnership which signifies that the
company does not come under the requirements to be audited to the Australian Securities and
Investments Commission.
However Aldi foods one of the Aldi companies reveals that it comprises of around 20%
in the gross revenues of limited partnership and signify Aldi Foods as a diminutive proprietary
enterprise regulated by international company (Barrowclough 2016). Other reports by Vigani and
Olper 92014) indicate that Aldi has produced at around $5 billion in revenues that further results
to the taxable earnings of $270 million and income tax rate of around $82% million.
Discussion
HRM Strategies within ALDI
Aldi being one of the leading retailers of Australia has considered that “people are the

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key to every achievement and success.” (Aldi.com.au 2018) Thus, there has a value for efficient
HRM practices and strategies which primarily emphasize on smooth delivery of a sector-leading
training package. The employee base has further been provided by highly enthused and the
recruitment or hiring procedures reports for the variety of vigorous and motivated people
(Barrowclough 2016). Aldi has fundamentally emphasizes on the improvement of welfare and
betterment of the employees thus constitutes a highly competent HR system which has been
implemented within the organizations. Vigani and Olper (2014) noted that one of the essential
initiatives relied on the fact that Aldi has been identified the first trader to efficiently offer female
employees with fully paid maternity leaves and other benefits. Furthermore, the organization has
been strategizing to pay increased pay scales in comparison to other similar retailing companies
operating in Australia (Korn et al. 2017). Aldi working environment and benefits offered to
employees have been regarded as highly exemplary and thus has been rated highest among its
other competitors (Reynolds 2014).
Resource based theory in ALDI
Taking into consideration the ideas of Resource Based Theory, it has been observed that
the human resource system within Aldi can be implemented with a view to offer a highly
Sustainable Competitive Advantage (Kozlenkova, Samaha and Palmatier 2014). This theory
however has proposed that this theoretical aspect could attain its success with the
accomplishment of four fundamental requirements within Aldi.
 The human resource practices within Aldi must be proficiently implemented with the
perspective to enhance and improve the business practices within the organization
(Kozlenkova, Samaha and Palmatier 2014).
 The talent sets situated within the human resources must be atypical, thus an evaluation

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of employment strategies as well as HR development strategies aim to signify that these
sets of talent and competence would be highly exceptional in characteristics.
 However, due to the capable HR strategies and approaches along with their
implementation replication of talents by competition can encounter high level of
challenges (Armstrong and Taylor 2014).
 Lastly, HR must not be formed out of redundancy further owing to advanced
technologies and because Aldi being within the Australian retail sector, this area will not
be relevant as the company would necessitate Customer Service Representation (CSRs).
Jones (2015) noted that the explanation competitive gain in any sector must be effectively
leveraged by the HR improvement functions. Eventually HR strategies of Aldi have encountered
certain degree of intricacies in justifying its value and position in Aldi. However, by enforcing
HR strategies to support regular business actions have further resulted to the expansion of
Strategic HRM within Aldi. Price (2016) indicates that HR strategies primarily participate in the
corporate strategy of Aldi rather than focusing on operations and management. Furthermore Aldi
has to sustain its cost of operations at the economical level and must be serving crucial role with
the aim to attain it (Aldi.com.au 2018). HR managers extensively evaluated the association
between Human Resource and the business strategy of Aldi, Australia in the increasingly level of
approval of domestic resources as essential supply of competitive gains which has been offering
authority to HR’s contention that people serve a highly considerable role in the success of Aldi
(Aldi.com.au 2018).
Atapattu (2015) stated that company has been executing its operations and assertively
sustaining its fundamental areas of competence to maintain economical price range by primarily
relying on its employee base. Its strategic HR practices primarily depend on selecting appropriate

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ways and approaches to employee suitable candidates for the appropriate role or designation thus
applying most efficient practices to attain organizational goals (Kozlenkova, Samaha and
Palmatier 2014).
Employee Training and Development in Aldi, Australia
Aldi, Australia along with its great level of inclination towards high level products and
services and further offering exceptional value for its consumer base has attained substantial
significance for its effectual approaches of employee development and training (Thals 2015).
Aldi in Australia has placed immense value and importance on providing newly employed staffs
with essential knowledge and skills in order to proficiently execute their tasks and responsibility
assigned to them. Studies by Bailey et al. (2015) stated that for the major section of on-the-job
training at Aldi stores in Australia, the assigned store manager serves a role of an employee
trainer. Such a training procedure has been used to provide adequate skills and knowledge to the
recently recruited store assistants to learn the way operate the stores and experience wide ranging
facets of the business Aldi deals with. However, off-the-job training has been efficiently
provided for improving forms of transferable skills and abilities which can be utilized at various
parts of the Aldi retail business (Brewster, Chung and Sparrow 2016). Aldi’s off-the-job training
typically aims to offer employment law, influencing competencies, performance evaluation along
with Aldi Management System. Studies on Aldi’s HR strategies and practices indicate that for
each crucial aspect of training Aldi efficiently decides the value and importance between on-the-
job and off-the-job employee knowledge development. However, off-the-job primarily includes
additional costs such as payments to training institutions (Brewster et al. 2016). These trainings
further imply that employees acquiring these knowledge development courses are fully
unemployed that can further lead to the rise of payroll costs and expenses. On the other hand,

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Vigani and Olper (2014) stated that balanced against these expenses are at the beneficial side
which the company generates from off-the-job training. These further incorporates the
advantages of comprising more enthused staff, substantial level of efficiency and hire staffs
possessing greater level of talent and capacity to provide enhanced customer services. It has been
noted that Aldi typically offers opportunities for youths in Australia where the apprenticeships
are open to 16-18 years of aged people (Korn et al. 2017).
Aldi Apprenticeship
Source-(Aldi.com.au 2018)
Development is regarded to be divergent to the concepts of training. Employee
development programme has been designed to develop the skills and abilities within the
employees who are extensively concerned with Aldi’s business (Aldi.com.au 2018). This can
further constitute certain level of disadvantages and challenges as it tends to provide workers
with substantial degree of value and importance in the Australian job market. However, (Rao
2018) revealed that Aldi has shown utmost willingness to encounter such risks as the company
has been highly committed in providing most-effective approaches and benefits to its employees.
The retail placement scheme of Aldi primarily invites university students for a 1 year placement

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and further facilitates the selected employees to exhibit their capacity which they can offer to the
business and vice versa (Barrowclough 2016).
Aldi Training and Employee Development
Source: (Aldi.com.au 2018)
Aldi Employee Relations and Grievance Handling
Aldi Australia’s Managing Director Bronwyn Post operating at the Brendale region has
revealed that the company has proposed that the National Employment Standards (NES) must be
efficiently shaped in order to facilitate employers as well as employees to develop greater level
of agility to establish practical and sound supplementary working hours above the standard 38
works week (Corporate.aldi.com.au 2018). This further has been purposed to permit employees
work for the duration they wish to and further improve the competence and capacity extent of
employers to utilize labour in a more productive manner (Korn et al. 2017). Furthermore, as a
significant example generated from Aldi’s recent experience related to wide ranging of Australia,
a union with exposure of small number of employees was able to arbitrate late in the approval
process and on issues irrelevant to the employees it professes to represent (Reynolds 2014). Such

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unjustified delay had exhibited unconstructive consequences for both the company as well as the
employee base in relation to instability, financial costs and diversion from managing any forms
of business.
Aldi has persistently employed major section of its employees on a permanent part-time
work basis. It has been noted that staffs are ensured to be rostered an average number of hours
and further will receive payment at the minimum level (Aldi.com.au 2018). The employees
furthermore obtain considerable number of paybacks and benefits related to permanent
employment that includes paid leaves.
Aldi Australia Employee Relation
Source: (Aldi.com.au 2018)
Conclusion
Aldi in relation to corporate strategy has been employing integrated cost leadership or
differentiation strategy which tends to acknowledge the philosophical understanding of Aldi’s
“where all people are able to buy grocery of highest quality at lowest price”. Furthermore,
recruits have been receiving increased rate of remuneration, compensation along with paid
leaves, maternity leaves and benefits and further acknowledge enhancement of skills and
capacities (Akbar and Ahsan 2014). The HRM strategy of Aldi has been efficiently aligned to its
business strategy and has been identified as a brilliant case of the way appropriate industry
strategy can be employed given highly exceptional outcomes and further maximising its

INTERNATIONAL HUMAN RESOURCE MANAGEMENT 11
resources and improving its capacity level (Brewster et al. 2016). However a highly enhancing
quality HR strategy with well-implementation is considered to be highly fundamental to attain
the goals and objectives within Aldi that sustain integrated Cost Leadership and Differentiation
Strategy (Collings, Wood and Szamosi 2018). Thus Aldi’s Effective HRM strategies and
practices have been stimulating its level of performance and serve a crucial role in the
organization. Some staffs receiving satisfactory remuneration and executing specific tasks and
responsibilities reduce the potential of errors resulting to an operational quality for the
organization (Brewster, Chung and Sparrow 2016).
Recommendations for Prospective HR Strategies
From the above analysis, the following set of recommendations has been made for Aldi
to attain its HR aims and objectives to comply with its corporate expansion strategy.
 It has been determined that for recent expansion or development, there can be identified
certain capability gaps within the organization which essentially needs to be
accomplished at the primary stage. Powell (2018) proposed that to successfully
accomplish the capability gaps, the activist as well as the reflector learning techniques
must be implemented on recently recruited employees of Aldi. The activist approach
would competently produce improved ideas while the reflector approach tends to develop
the staffs as their leaders by illustrating them on the approaches of executing a specific
task.
 It is highly suggested by Barrowclough (2016) for Aldi to essentially prioritize and focus
on their strategies and approaches in a way it can be effective on management trainee
program to develop stores at primary stages so that newly recruited staffs can perform
smoothly under the supervision of managers. After managers being adequately competent

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to execute assigned roles and responsibilities, the greater critical accountability lie on
Aldi to shed light on process of mentoring as well as coaching approach for resourceful
outcomes along with professional development of employee base (Reynolds 2014). This
approach must be employed for promoting higher level of collaboration and competence
for both managers and employees towards the purpose and goal of the company which is
to sustain its competitiveness and growth in the Australian retail sector.

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