Understanding ALDI's Strategic Planning Through SMART Goal Framework

The document discusses how ALDI has successfully integrated the SMART goal framework into its strategic planning process. This approach focuses on establishing clear objectives that are Specific, Measurable, Achievable, Relevant, and Time-bound. By defining precise targets for various aspects such as sales growth, market share, employee training, and sustainability initiatives, ALDI ensures alignment across different organizational levels. The structured implementation of SMART goals has enabled the company to monitor progress effectively through relevant performance metrics, facilitating timely adjustments to strategies when necessary. This strategic alignment not only drives business success but also fosters continuous improvement within the organization. Furthermore, ALDI's focus on setting time-bound objectives allows it to achieve short-term wins while working towards long-term growth targets, thereby solidifying its competitive position in the market. The analysis underscores the importance of clear communication and measurable outcomes in achieving organizational goals, highlighting ALDI's commitment to strategic excellence.

BUSINESS STRATEGY
Table of Contents
INTRODUCTION..........................................................................................................................................................2

TASK1......................................................................................................................................................................... 3
1.1 Strategic planning in compliance with company vision, mission and core competencies.............................3
1.2 Factors influencing ALDI strategic plan...........................................................................................................5
1.3 Effectiveness of techniques utilised during formulating strategies................................................................8
INTRODUCTION
Business strategy is a long term plan which is developed by organisation in order to achieve
their goals and objective, to increase profitability of firm in many fields. This strategic
development involves identification of various types of tools and techniques in order to bring
efficiency in processes of organisation. Business strategy can be refereed as various
developmental plans that are being designed in order to achieve several objectives in compliance
with vision and mission statement of venture (Moon, 2010). Strategic planning is a long process
which include identification of assorted steps that are designed in order to carry out various
activities that are carried out by venture to fulfil all needs of venture for its growth and expansion.
It is a systematised process which involve step by step development of various short term plans in
order to achieve bigger goals of the enterprise.
For long term planning for any growth and expansion plan various strategies is to be
developed in order to efficiently achieve objectives by reducing waste and optimum utilisation of
available resources. Strategic planning plays very important role in development of various polices
and norms to perform effectively in business environment. Changing technology and several
external factors largely influence functioning of firm which have to be controlled by development
of different efficient strategies in workplace (Van Grembergen and De Haes, 2012). ALDI is a group
of two discounted retailing stores. The company is engaged in delivering its services in about 12
countries through 10,000 stores worldwide approximately. Company is involved in retail sector in
selling various household, sanitary products and also engaged in service delivery in food and
beverages sector. ALDI is making approximately 53 billion euros in business environment through
implementation of profitable strategies in workplace. In this respective organisation goals, mission
and vision of ALDI is discussed along with analysing various external factors influencing its core
competencies and functionality of business entity.

TASK1
1.1 Strategic planning in compliance with company vision, mission and core
competencies.
Different plans of strategy formulation provide direction to the growth and expansion for
business firm (MacGregor and Business Objects Sotware Ltd., 2010). Strategic development helps
in identifying various aspects affecting functionality of organisation and formulating various
techniques in order to resolve various issues faced by the venture. ALDI is a retail outlet that use
various plans and schemes in order to rate a brand image through its core competencies which
provides path of development and growth in commercial environment. ALDI is working for
enhancing company profitability by effective management of available resources and employee
competencies in working environment which helps in developing various strategies in order to
regulate functioning and processes of venture to earn more profitability by efficiently achieving
goals and objectives of firm according to defined mission and vision statement of enterprise
(Norton and Pine, 2013). This is a multinational company which in engaged on large number of
operation that bring complexity in its functioning that have to controlled through development of
profitable strategies for its expansion and growth through various marketing and development
plans.
Mission statement: This defines reason behind the establishment of the firm in
marketplace. Mission of an organisation is the motive behind its functioning and operation.
Mission statement is the ultimate reflection of functioning of firm that helps in convenience in
various investors to invest in company to increase its probability through franchising brand and
expansion of business. The mission statement of ALDI is “Top quality at incredibly low prices-
guaranteed”, (ALDI, 2017). The operation of ALDI should be working in compliance with the
mission statement in order to direct the employee towards their respective task and motivate
them to work efficiently. Mission statement of ALDI will be helpful in defining strategic plans of
organisation in order to achieve goals effectively. The strategic plans like the firm can go for
various cost reduction strategies in order increase profitability of firm.
Vision: This statement defines that various long term plans of organisation have to be
achieved by firm through effectively management of its operations. Vision statement defines the
ideology of venture in which ALDI is working and future goals that are to be achieved through

development of various growth strategies (Grant, 2016). Vision statement of organisation can be
defined as development of brand with quality and valued products in market at lowest price. ALDI
vision can be refereed to future position that are to be achieved by organisation through
managing and implementing various strategies in present in order to accomplish defined gaols
according to state in vision statement.
Objectives: These are the various targets that are to be achieved through various functions
of company in order to accomplish all requirement of vision statement of firm. This provide
information about the destination that have to be reached by organisation in completing all
aspects of vision statement. The various objectives of ALDI can be achievement of low prices in
marketplace with quality product that increase value of firm as well as services. These are the set
of several targets that helps in accomplishing vision statement of ALDI.
Goals: Objectives and goals are the having similarity in meaning. But these two terms can
be differentiated from each other on the basis of target and motivation behind their achievement.
Goals are the target that are achieved through analysing core competency of firm and this
measures its performance (Osman, Ho and Carmen Galang, 2011). While objective describes the
destination that are to be achieved through accomplishing various goals of ALDI. Various strategies
of ALDI like increasing efficiency in delivering quality products and decrease cost in production and
using human being in production of products helps in achieving goals, mission, objectives of firm
effectively of making quality goods at low prices.
Core competences: These are the competencies and the quality of resources that are
available to company in order to accomplish all mission and vision of firm effectively. This defines
various qualities of raw material and available resources in organisation that helps in building
competitive advantage over various products of other micrometres in market. Competitive
advantage of ALDI like lower prices products, efficiently customer care services and effective
supply chain which helps in developing efficient strategies in order to gain profit through efficient
use of implementation of competitive advantage in practice. This helps in gaining more profit over
their services through gaining competitive advantages over other companies. Core competency of
a venture can be its infrastructure, quality product, service delivery methods and various
strategies that are used during expansion of business.
All these defining features of organisation strategies are connected with the company
functioning and planning. The formulation of strategic plan is highly dependent on the mission and
vision statement of company (Park and El Sawy, 2013). The mission are the various objectives and

goals that are achieved through developed vision of ALDI. These statement provide direction to
development of a firm ALDI effectively. So, these plays an important role in expansion of business.
Strategic plan should comply with all the requirement of organisation in order to fulfil vision and
objectives of enterprise. Strategies formulated by executives of company are having long term
motives that are to achieved by effective planning in workplace and among workforce in order to
optimum utilisation of available resource and competencies of brand.
1.2 Factors influencing ALDI strategic plan.
There are many factors which are influencing the strategic plan and its implementation in
practice. It has been recorded that ALDI supermarkets alone shown a huge growth their sales by
effective managing and controlling factor influencing strategic implementation in firm (Cheng,
2013). The sales increased up to 19.8% in only 12 weeks to May 2017 (Guardian, 2017). Strategies
formulated by higher authority of company and their decision are highly influenced by different
factors that may be controllable or uncontrollable by business venture. So, in order to develop an
effective and profitable plan for enterprise ALDI has to work in compliance with various aspects
that may affect functionality and strategic planning of enterprise largely are described below.
Future competition of ALDI brand: Competitors policies and their profitability largely
affects the strategic implementation of a company. As the customer make choices from various
alternatives that are available in marketplace (Chen and et. al., 2010). So, strategies developed by
company should be formulated after analysing impact of policies of other companies existing in
same product line in order to bring efficiency in strategic plan.
Customers wants: Customers needs, choices and preferences are continuously changing
with the external environment and level of eduction. This can be analysed through changing taste
of consumer largely affects strategies developed in organisation. The various promotional and
expansion policies and plan is influenced by changing desires and expectation of consumer
towards brand image and thereto product and services. The customer are the ultimate user of
product and services of ALDI. So in order to satisfy them efficiently the organisation should
develop strategic plan in compliance with changing consumer needs and wants.
Competitive advantage of company: Various competencies of an firm helps in building an
food competitive brand image in market which leads to higher profitability of firm through
adopting various strategies related to the gaining competitive advantage in market depends ion
the strategies that are formulated by higher authority. Strategic planning of ALDI should be
complied with the strategic planning in order to compete with other competitors in market
efficiently.

Stakeholders of organisation: The various stakeholders like media, customers, supplier,
government and shareholder also have great significance in formulation of new strategies for
growth and expansion of business (Champoux, Durgee and McGlynn, 2012). All shareholders plays
important role in decision making process of strategic planning and its effective implementation in
workplace. Government changing policies also fundamentally influence the formulating plans.
Government changing policies also largely influence the formulating plans. The strategic planing of
ALDI should comply with all the stakeholders need in order to develop an mutual development of
organisation as well as the stakeholders contributing in growth of entity.
Internal and external factors: Various internal factors like human resources, internal
functionality and effectiveness of operation, available technology in workplace, safety measures
and various external factors like political, sociological, economical factors collectively affects the
development of various strategic plan in order to accomplish vision and mission of ALDI effectively
by optimum utilisation of competitive advantage through core competencies of firm.
Porter Four Generic Strategies formulate various type of plans in order to achieve
competitive advantage in the scope and opportunity of different countries. This helps in
developing and defining various strategic plan in order to target market and expand business
effectively. The generic strategies developed in order to gain competitive advantage in market can
be cost leadership, differentiation, cost focus and differentiation focus. All these strategies involve
implementation of various tools and techniques in order to gain competitive advantage and space
matrix market cost leadership helps in receiving advantage over other competitors over the prices
and cost of product and making it available at lowest prices in market. This can be defined as
gaining cost leadership over other company (Osarenkhoe, 2010). While differentiation in
introduction uniqueness in process which can be achieved through bringing changes in respective
product line to target specific needs of customers. While focus strategies can be dependent on
developing cost strategies or differentiation strategies. Cost focus plans helps in targeting small
segment for market according to the pricing policies of ALDI. While Cost differentiations of
targeting or aiming the customer segment according to the uniqueness in product that are helpful
in gaining competitive advantage market.
1.3 Effectiveness of techniques utilised during formulating strategies.
BCG matrix is also known as Boston Consulting Group Matrix that help in defining various
competitor advantage that can be developed through core competencies of organisation by

defining various COW, DOG, QUESTION MARK and STAR strategy in workplace and marketplace.
While SPACE matrix is known as Strategic Position and Action Evaluation in practice. This analysis
effectiveness of formulated strategies through measuring actions of organisation. This defines
various aggressive, competitors, destructive and conservative strategies by analysing
environmental and industry stability along with identifying financial and competitive advantage of
brand.
BCG growth matrix SPACE technique
Advantages This is helpful in defining various
types of strategies according to the
core competences and competitive
advantage of ALDI.
This studies various factors like financial
strength, and environmental stability to
evaluate action plan developed from the
strategic pan.
Limitations This matrix is only dependent on
the market share and are of market
growth.
It consider only the aggressive,
competitive strategies of company, not
dealing with various competencies of
organisation.
The BCG matrix core purpose is that help ALDI define strategies according to hwere they
are in the matrics i.e. Cash Cow, Dog, question mark and star strategies in order to bring
competitive advantage in market. This can be implemented in organisation through analysing
various resources and their competences in firm functioning. Cash Cow strategies for the products
which are in the position of higher market share growth but having lower market growth.
Question mark or problem child strategies product is having higher market growth and
profitability but lower capacity to capture more market shares. While Dog strategies is developed
by organisation in order to monitor the growth of product which are having low market growth
and share both (Lowth, Prowle and Zhang, 2010). These type of products should be drop off by
organisation to reduce wastage of funds in firm. Star strategy are developed for the products who
is having higher profit making capability with having higher market growth and shares both.
SPACE matrix analyses various internal and external factors like financial strength,
competitiveness, industry and environmental strategies. This can be defined by analysing
performance of product in these external and internal factors with defining various conservative,
aggressive, competitive and destructive strategies.

According to SPACE matrix, ALDI is following an aggressive strategy, which shows its
strong competitive position on the market with its rapid growth. This include their product
development, integration with other companies, acquisition of competitors, etc. Their strategy
include the four main areas of analyses:
- Internal : Financial strength and Competitive advantages
- External: Environmental stability and Industry strength.
In the picture below are shown the internal and external factors which build the SPACE
matrix for ALDI:
Source: Thomas, 2014.
As a company which operates on the international market, ALDI is using SPACE matrix as it
shows the internal and external factors which affect the company, while Boston matrix more
oriented for the product market growth and share, which the company can use for their products.
The analysation of internal and external factors are the key points for the long term business
strategy success of ALDI and their rapidly growth on the market. The BCG matrix is helpful in
defining the strategic plans and the opportunities thin which the ALDI firm should invest and
describes about opportunities which will be beneficial or industry. The Space matrix also helps in
defining various strategies of ALDI that can contribute in higher profitability of firm through
making efficient plans working in compliance with financial strength of firm and competitiveness
of business entity.

TASK 2
2.1 Organisational Audit of ALDI
Organisation audit is an approach of defining various core competences, strength
and weaknesses of ALDI through which the business maintain its good strategic position in market.
This audit brief is about all the capabilities, resources and strategies that are helpful in
development of venture. This internal audit is needed by ALDI in order to analyse firm position in
market and various growth opportunity that can be achieved through effective implementation of
different growth strategies.
Strategic position of firm can be expressed through the extent of which organisation is
using its resources optimally in order to generate desired profitability for venture. ALDI is an retail
outlet and has developed good strategic position in market through its cost leadership in market.
The company is providing its quality product at lowest price in market.
Organisational audit is the analysing internal capabilities of firm in order to identify various
strategies for business extension and growth. SWOT analysis can be helpful in analysing strength
and weaknesses of company which leads successful implementation of strategies in workplace on

order to grab various opportunity through analysing threat to venture development. The SWOT
analysis of ALDI is described below.
Strength:
 Top quality product.
 Region-able prices with valued services
and products.
 More than 2500 stores in UK.
 Well established multinational brand.
 Operating in about 15 countries of
world.
 The company is having good financial
condition in UK market.
Weaknesses:
 Smaller than other competitors in
current UK market scenario.
 Lesser number of organisation
subsidiary are established till now.
 Ineffective in developing global impact.
 Some times expressed as cheap brand
in market.
Opportunities:
 More investment in advertisement of
product and services effectively.
 Expansion into various countries.
 Entry into different developing
economically countries.
 Can invest in newer product lines to
enhance profitability of firm.
Threat:
 Not involved in delivering complete
shopping experience to customers.
 This can be affected by brand image of
other well established companies.
 The fierce market scenario arise higher
competition in UK market having
threat to growth of company.
 The political instability can be another
threat to development of ALDI.

This can be conclude from the above SWOT analysis of ALDI is that the company is
having many strengths with good competitive advantages in organisation operations and
functionality which will help in overcoming the weaknesses of firm and helps in grabbing
various growth opportunities in UK market.
Porter four generic strategies formulate various type of plans in order to achieve
competitive advantage in the scope and opportunity of different countries. This helps in
developing and defining various strategic plan in order to target market and expand business
effectively. The generic strategies developed in order to gain competitive advantage in market
can be cost leadership, differentiation, cost focus and differentiation focus. All these strategies
involve implementation of various tools and techniques in order to gain competitive advantage
in market.
Cost Leadership: Following helps in receiving advantage over other competitors over
the prices and cost of product and making it available at lowest prices in market. This can be
defined as gaining cost leadership over other company (Osarenkhoe, 2010).
Differentiation: While differentiation in introduction uniqueness in process which can
be achieved through bringing changes in respective product line to target specific needs of
customers.
Focus Strategy: While focus strategies can be dependent on developing cost strategies
or differentiation strategies. Cost focus plans helps in targeting small segment for market
according to the pricing policies of ALDI. While Cost differentiations of targeting or aiming the
customer segment according to the uniqueness in product that are helpful in gaining
competitive advantage market.
Porter's four generic strategies can be helpful in expansion of ALDI business. This can be
an profitable strategic development by ALDI as this will decides various expansion plan of
organisation which will be targeting customers on the basis of uniqueness, cost or
differentiation specification of products and services.
2.2 Environmental audit for ALDI showing micro and macro environment
Micro environment is a small scale environment of a business enterprise. The factors of
micro environment are directly impact on the operations of business and also on decision
making process. Company can control these factors (Meskendahl, 2010). In this factors include
customers, suppliers, employees, government, and shareholders.
The porter's five forces are very helpful in analysis the competition level in an
organisation. There are five forces of porter:
Competitive rivalry- In this determine that the present competition at marketplace and
with the help of this, company can easily know about its current competitors and their
strategies.
Supplier bargaining power- Under this includes concentration of suppliers, affect of
input price, differentiation in inputs, significance of supplier etc.

Customers bargaining power- Consumer always looks for lower price products or
services. They have the power and ability to minimize cost. If ALDI increase price in its products
then in this case users can switch from this company to another.
New entrants threat- IT is difficult for rivals to come at marketplace. In this risk involved
is very high and there are many obstacles included and those are cost advantage, inputs etc.
Threats related with substitute goods or services- It means when a person switch a
company to other competitor then in this case it can impact on its sales. The customers
compare its products from its competitors and then decide which product wants to purchase.
Customers
They plays most important part in ALDI. It is the responsibility of company towards its
customers to provide better quality services and products to its customers at
reasonable price and on proper time. The first priority of ALDI is to satisfy the needs
and wants of its customers. Before producing any products, it is necessary to identify
their tastes and preferences and then prepare goods according to them. It will helps in
increasing sales, productivity and profitability of this business firm.
Employees
They are the main part of business organisation. In ALDI, there is a need of skilled and
qualified employees. For reducing the impact, manager should be appoint employees
according to the need of job. To enhance the productivity of business, ALDI provide
training and development to their employees. It helps in importing and increasing their
skills, abilities and knowledge. And from this their working performance and customer
service will be improved.
Suppliers
The main responsibility of supplier to provide good quality raw materials on proper
time. So, company has to choose or select right supplier who provides raw materials on
time. The behaviour or nature of suppliers is directly effect on business operations and
supply.
Shareholders
These are the people who invest their money in ALDI for earning profit. The main
motive of shareholders is to increase more and more profit. They are the owners of a
business enterprise. The relationship with shareholders of company required to
manage in a proper way to increase short term profit quickly.
Go
vernment
It makes some policies, rules and regulations for company and an organisation has to
work under these policies.
The macro environment exist inside the economy as a whole. In this, there are some
factors like social, technological, socio cultural, legal, and political, which influence ALDI