Essays on Strategic Management and Competitiveness of ALDI Australia Case Study

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The paper 'Strategic Management and Competitiveness of ALDI Australia" is a good example of a management case study. This report on strategic management and competitiveness of an organization is based on the case study of ALDI Australia. The intention is to identify strategic management issues, competitive landscape and identify some of the strategic management tools such as Porters 5 forces, value chain analysis and business level strategies. ALDI is a German-based retail grocery store was established in 1948 by Theo & Karl Albrecht in Ruhr, Germany. The company has diversified and expanded to various countries including Australia.

It is one of the world’ s biggest global food retailers with more than 7000 stores. ALDI Australia started in 2001 and has expanded to states like Queensland, Victoria and New South Wales. The organizational mission is to provide people with the highest quality-low priced products (Hitt & He, 2008). This strategy is behind Aldi’ s success. The report has provided in detail information of Porters 5 forces, value chain analysis and business level strategies used by ALDI. These tools have been used because they provide insights on the current performance and future direction of the company in relation to its competitors.

Porter’ s five forces look at the external environment while value chain analysis considers the internal environment (Porter, 1985). Recommendations are made based on these analyses to provide the strategic direction and sustainability of ALDI. 1.1 Strategic Management and Competitiveness Strategic management involves using techniques and tools that will increase an organization’ s competitive advantage and performance. These tools include setting goals, market leadership, infrastructure development or product differentiation and brand development. Companies become competitive when they utilize resources efficiently to meet the ever-changing needs of customers.

Some of the factors influencing firm competitiveness are; technology, corporate culture, talent, research and development, responsiveness to needs of employees and communities. Strategic competitiveness is in the ability of the organization to favorably win a sizeable market share for its products, increase profitability on a steady platform and long-term sustainability. Demarie, Keats and Hitt (2007) note that the new competitive landscape engenders increased organizational advantage over its competitors through drivers such as economic activities, globalization of business and technological revolution. The Internet has become the new international highway not only to advertise but a point-of-sale and distribution.

Emphasis on knowledge intensity gave rise to competitive advantage and positive feedback industries. Technological convergence brought instant changes. Globalization enhanced cross-border relationships for multinational firms to expand to emerging markets and transitional economies (Henderson & Cote, 2003). It influenced the marketing of services and goods as well as supply chain through sourcing activities in their value chains to organizations in different countries. ALDI is a beneficiary of globalization, technology and knowledge is an international expansion to Australia.

Thompson (2001) argues that an organization exploits the less competitive landscape in the country to gain a competitive edge and increase market share in four states. In order to take advantage of the new competitive landscape, ALDI maximized changing expectations and careers, innovation and continuous learning, consumer satisfaction, quality and price in hypercompetitive markets and blurred industry boundaries. The company remained lower in product prices compared to some of its major competitors such as Coles and Woolworths. It also led on its supply chain by sourcing from within Australia from reputable suppliers of vegetables, fruits, chilled dairy and fresh meat.

It also became a market leader in online product advertising in which all its product and their prices were listed online for customers to get the exact value (Yoon et al. 2006). Limited product lines in ALDI maximized creativity and avoided price tags to increase sales. By exploiting on product and consumer knowledge, the organization was able to offer weekly special offers on expensive products and weekly discounts on cheaper items. The company remains determined to remain low on product prices especially on grocery shops.



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