ALDI Case Study: Business expansion through training and development

Questions

Read the attached document about Aldi. Then analyze the companys internal strengths and weaknesses as well as its external opportunities and threats.

1- Strengths:

What are the things the company does well?

What are the advantages (e.g. key areas of best-performing activities of this company)?

2- Weaknesses:

What the things the company does not do well?

What could be improved (e.g. key area of the problems)?

3- Opportunities:

What external factors favor the companys strengths?

How can the organization take advantage of the existing external factors to improve the performance of the company?

4- Threats:

What external conditions do not relate to the companys strengths or favor areas of current weakness?

What are the obstacles and constraints that are affecting this company? (e.g., key areas where your competitors will perform well or better than you)

Introduction Aldi is a leading retaler with over 8,000 stores worldwide. It continues to expand in Europe, North America and Australa. The Aldi brand is associated with value for money. Its stores provide customers with a wide range of products. There is an emphasis on high quality products and providing excellent value for customers. Aldis slogan is 'spend a little, live a lot'. It works hard to keep prices low for its customers. The company buys large quantities of products from carefully selected suppllers. Its buyers are experts who choose the best qualty products at the most competitive prices. The savings achieved by sourcing products in this way can be passed on to customers. Aldi keeps costs down in other ways. it ensures its operations are as efficient as possible, for example, store layouts are kept simple and opening hours focus on the busiest times of the day. it is about helping Individuals to gain knowledge, learn new skills and develop a wide range of attributes. Development makes employees more adaptable and more able to take on a wider range of roles. This case study will demonstrate how Aldi's training and development programmes help ensure its employees have the skills and competences that the business requires both now and In the future. Identifying training needs Workforce planning is the process of finding out how a business will meet its labour requirements both now and in the future. Ald, like other businesses, needs to predict its future stafing needs accurately. It needs to plan for both the number of workers it will require and the specific skills that the business will need in the future. The company can then recrult new staff if necessary. It can also ensure that it has training and development programmes in place to meet these needs. Aldi places great importance on how it trains and develops its employees. Training is the process of providing employees with the necessary knowledge and skills to perform their tasks and roles competently. Training not only helps to Increase business efficiency but it can also make staff more motivated by increasing their job satisfaction. Whille training is narrowly focused on helping a company become efficient and effective in the short term, development is more about building the long-term capabilities of the workforce. Aldi identifies future training needs through an ongoing analysis of company performance in key areas at all levels. For example, the company monitors the availability of its products to the customer within its stores. If the level of availability drops below the targeted level then a programme of training on order accuracy would be undertaken. It also considers future developments within the business and within the grocery retall sector in order to predict both the total numbers of start it wil need and, more crucially, the skills and competences that will be required. Aldi's rapid expansion means that its current workforce cannot meet its future starting requirements. The company will need to recrut more than 4,000 new members of staff within the next 12 months to meet the requirements of current exceptional sales growth and new store openings. To attract the best candidates, It Offers Industry-leading salaries at all levels. Through a process of interview and assessment, managers identify if candidates have the precise skills and competencies that the job requires. If the selection process shows that they are suitable, then they will be recruited and Aldi can be confident that they will fulfil the chalenges of their role. Although Aldi expects new recruits to make an immediate contribution to the business, it also provides training so that they can develop their careers within the company. Aldi has entry levels for apprentices, store assistants, deputy managers, assistant store managers, trainee store managers and graduate trainee area managers. Aldi organises high-level training for recruits to all levels. For example, in their first year, graduate recruits receive training in all areas of the business. This ranges from training in-store to understand how the retail operation works, to regional office tasks such as logistics, trading and financial planning. All new recruits go through a comprehensive structured training plan. New employees learn about the philosophy of Aldi and its expectations of them. This is important in making new employees quickly feel part of the Aldi farrily. This training will be appropriate to the role, so could be in a store or at an Aldi regional office. On-the-job training On-the-job training is training that takes place while employees are actually working. It means that skils can be gained while trainees are carrying out their jobs. This benefits both employees and the business. Employees learn in the real work environment and gain experience dealing with the tasks and challenges that they will meet during a normal working day. The business benefits by ensuring that the training is specific to the job. It also does not have to meet the additional costs of providing off-the-job training or losing working time. There are several methods of providing on-the-job training. Four frequently used methods are briefly described here: Coaching - an experienced member of staff will help trainees learn skills and processes through providing instructions or demonstrations (or both). Mentoring - each trainee is alocated to an established member of staff who acts as a guide and helper. A mentor usually offers more personal support than a coach, although the terms 'mentor' and 'coach' are often used interchangeably. Job rotation - this is where members of staff rotate roles or tasks so that they gain experience of a ful range of jobs. Sitting next to Nellie' - this describes the process of working alongside a colleague to observe and learn the skills needed for a particular process. This can be a faster and more useful way of learning a job role than studying a written manual. The colleague is always on hand to answer any questions or deal with any unexpected problems. For most on-the-job training at Aldi stores, the store manager acts as the trainer. A typical format is for the manager to explain a process to the trainee, then to demonstrate it. The trainee then carries out the process, while the manager observes. Once the manager is happy that trainees are competent, they can then carry out the process unaided. This process is used for example, to teach a store assistant how to operate the till and to instruct a trainee manager how to order stock accurately. CON AS Off-the-job training As the name suggests, of-the-job training is provided away from the immediate workplace. This might be at a specialist training centre or at a college or at a company's own prerrises. This type of training can be particularly useful for developing transferable skills that can be used in many different parts of the business. It may be used, for example, to train employees in the use of new equipment and new methods or to bring them up to date with changes in the law. Typical off-the-job training courses offered to employees by Ald include: recruitment, interviewing and selection employment law influencing skills performance reviews (appraisals) Aldi Management System (how to develop and performance manage people). For each aspect of training Aldi decide whether on-the-job or off-the-job training is the better option. Off-the-job training may involve extra costs, such as payments to training organisations. It also means that staff taking training courses are not at work, so their jobs have to be covered by others. This can lead to an increase in payroll costs. However, balanced against these costs are the gains that Ald makes from off-the-job training. These include the benefits of having more motivated staff, greater staff productivity and employees with better skills and the ability to provide improved customer service. Aldi provides training opportunities for young people. The Aldi apprentice scheme combines on-the-job and off-the-job training. Apprenticeships are open to 16-18 year olds. Apprentices training as store assistants also study for an NVO in Retal Apprenticeship. They complete store assistant training and gain an MQ Level 2 in their first year. They then take a store management training programme over two years and work for a Level 3 advanced qualification The variety seems to suit apprentices. As Sam, an Aldi apprentice says: The fast pace of the role is really exciting, with lots of chances to learn new and useful skills. As well as the on-the-job training, there is also studying towards a recognised qualification that I can fit around work.' Emily, another apprentice, recognises that the programme is a good opportunity: 'After attending college I was looking for an opportunity that would allow me to use my customer service skills and the Aldi apprenticeship has given me just that. There is a lot of competition for places, so you realy need to want to succeed. I really feel part of the store team. It can be challenging but it is wall worth it." At the end of their apprenticeships, Sam and Emily wil have the knowledge and skills to take on deputy manager or assistant store manager positions. From there each can rise to become a Store Manager in the business. Aldi's current growth means that there are many opportunities for promotion, so Sam and Emily could soon join the many others who have been promoted within the business. Development Development is not the same as training. Development focuses as much on personal growth as skills that are directly related to the job. A development programme is designed to make individuals more skilled, more flexible in their approach and better qualified for their chosen careers. Conclusion Aldi spoks to provide its customers with quality products at prices that provide value for money. It wants enclent operations, with its stores staffed by people who are keen and competent. Ald's success is shown by the fact that it is expanding rapidly. It is opening new stores and experiencing sales growth that requires it to take on more staff. This means that it needs to combine good recruitment polices with robust selection processes. BAS Through a development programme, employees can obtain transferable qualifications that benefit the Individuals concerned as wel as the business. This can have disadvantages for the business, as it gives workers greater value in the job market. However, Aldi is Willng to take this risk as it belleves in providing what is best for its statt. Development options for apprentices Indude working for various qualifications. Aldi has a fast-track approach for graduates. Opportunities for graduate recruits at Aldi include secondments to different International countries to develop all-round expertise. Staff are recruited from school or college into Aldis apprenticeship Scherne or directly into stores for positions from store assistant up to trainee Store Manager. Those from university with a 2.1 degree or better are able to apply for the Graduate Area Manager programme. All recruits are assured of appropriate on-the-job and on-the-job training, as well as career development opportunities. Promotion is open to all staff, regardless of the route they choose to join Ald. Aldi puts great emphasis on developing its people. Over 85% of Aldi directors have been recruited from within the company. This commitment to training and development makes Ald a business of choice for both ambitious teenagers and top graduates. This is shown by its placing in the Top 5 In The Times Top 100 Graduate Employers and the Graduate Employer of Choice for 2012 for General Management. The Aldi retal placement scheme takes university students on a one-year placement. This allows the chosen Individuals to show what they can offer the business and to find out what the business can offer them. Aldi offers an excellent reward package for students on a placement, but in return expects trainees to have enthusiasm, drive and ambition. Successful students get the opportunity to apply for a place on Aldi's Area Management training programme To support their development, managers help employees to set personal goals. These are identified during an appraisal process. This is when a member of staff sits down with their line manager to evaluate past and current performance, to consider what skills are needed going forward and to set targets for the future. This could Involve Identifying further training or development opportunities