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Management and Operations of Aldi UK

Info: 7403 words (30 pages) Dissertation
Published: 10th Dec 2019

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Tagged: ManagementRetailBusiness Strategy

 This report will examine the impact of leaders and managers on the operations of Aldi UK

Aldi UK is a limited line discount retailer. ‘’First UK store opened in 1990, with first Irish store opening 9 years later. There are now over 620 stores in the UK and Ireland and approximately 1300 items listed every day, in every store’’ (Aldi.uk.co, 2017)

P1. The report will define and compare, in the first part, different roles and characteristics of a leader and manager

According H. Fayol Management is defined to be a process of Planning, Organizing, Leading and Controlling resources, effectively and efficiently to achieve the organization’s objectives

In this definition, an organization will mean a group of peoples who collaborate toward common objectives.

By effectively we will understand achieving objectives up to 100% and by efficiently we will understand achieving objectives using fewer resources, as a store manager from Aldi wants to achieve a sale efficiency by 100% but using as resources, fewer store assistants to complete a job.

As from this definition, H Fayol proposed four main functions of management: Planning, Organizing, Leading and Controlling.

Planning is where the objective and the way to achieve them is established.

A store manager may have given objectives like efficiency per day or sales volume at that day, but he can always set a bigger objective or a complementary objective, like in one day he decides to reorganize the warehouse for next shift.

Organizing is the process that determines the tasks, who will do them and lead.

Organizing is dividing the jobs to different staff and give them resources. A general mistake happens when everybody is responsible, as if everybody should be responsible for the order in the warehouse, but there is still disorder. But when manager determines who will be responsible for this specific job and allocate him the necessary time it is more probable to find the warehouse clean and order.

Leading is achieving the organisations objective with the contributions of its members buy motivating, directing, inspiring, encouraging them.

Controlling ensures that performance is achieved according to what planned. Controlling consists of: establishing performance standards, evaluating actual performance against standards and taking corrective action when necessary. A manager is always controlling the performance of employees, like how much time it takes to arrange fresh vegetables on the designed shelf, because this time is standardized, so it is an objective.

Leadership has many definitions, but we distinguish two of them, where leadership is defined:

-as being the art of influencing people’s behaviour in order to achieve (accomplish, attain, obtain) objective in the way desired by the leader.

– ‘’as the ability to influence a group towards (against) the achievement of a vision or set of goals’’ (Robin and Judge 2007)

Although both of the two definitions are right we can observe small difference, as the 1’st definition considers leadership being an art, which means that not everybody could be a leader as not everybody could be an artist, yet the second definition considers leadership as being on ability influence people are not born with this ability they could learn it or develop it.


Mintzberg suggested that there are ten leadership roles, which are divided into three categories.

Leadership Roles

(Source: S. P. Robbins and M. Coulter, Management, 2013, Pearson)

 

The roles in interpersonal category involve providing information and ideas.

Figurehead – Managers, have social, ceremonial and legal responsibilities. They are supposed to be a source of inspiration. People consider them as a person with authority, and as a figurehead.

Leader – This is where managers provide leadership and they deal with the performance and responsibilities of everyone in their followers.

Liaison – Managers must communicate with internal and external contacts. They need to be capable to set connections effectively on behalf of their organisation.

The roles in informational category involve processing information.

Monitor – In this role, a manager observes for relevant changes in the environment and obtains information related to his organisation and industry.

Disseminator – This is where managers share useful information, collected as a monitor, to their colleagues and their team.

Spokesperson – Managers speaks on behalf of his organisation. In this role, they communicate information about their organisation and their aspirations to the people outside it.

The managerial roles in decisional category involve managing information.

Entrepreneur – The manager creates and controls change within the organisation. This involves generating new ideas and implementing them.

Disturbance Handler – The manager mediates disputes within the company and when an organisation or team hits an unexpected roadblock, it’s the manager who takes the lead.

Resource Allocator – Manager determines where organisational resources are best used and allocates funding, as well as assigns staff and other organisational resources.

Negotiator – manager participates and directs important negotiations within his team, department, or organisation

Leadership is one of the manager’s role, so none of them are done by different persons. Although leadership and management are executed by the same person, we must distinguish them.

According to Peter Drucker ‘’leadership is doing the right things, but management is doing things right’’.

According to John P. Kotter ‘’managers produce predictability and order, but leaders create, communicate and implement visions of the future which enable companies to change themselves in a changing competitive marketplace’’.

Comparing Management and Leadership

(Source: John P. Kotter, 1947)

P2. This part of the report will put on view how the role of a leader and the function of a manager apply in different situational contexts within ALDI UK. For this, it will be explained the three Organisational Situations, it will be revealed in which situation is ALDI UK found, therefore, it will be analysed the impact of the organisational situation of the company on its four Management Functions and it will be presented which of the four ‘Leadership Styles’ are being applied in the company.

A manager’s managerial or leadership responsibilities can be affected by situations inside or outside of a company.

There are different types of Organisational Situations but from all of them, we will discuss these three types: stable situation, slow-to-moderate changing situation and fast-changing situation.

In the stable situation, the changes don’t exist, or they are very limited inside or outside of the organisation. In the stable situation, the leadership styles or management functions of a manager don’t need to be modified until the situation changes noticeably.

In the slow-to-moderate changing situation, there are some noticeable changes inside or outside of the organisation. In this situation, a manager should make some modifications in a mid or long period of time in his leadership styles or management functions to adapt to the new situation.

Fast-changing situation

In the fast-changing situation, there are so many changes that are happening fast inside or outside of the organisation. In the fast-changing situation, a good manager needs to make important changes, to adjust to the new situation, in a short period of time.

ALDI UK is in a fast-changing situation in this period. The internal environment of the company could be in a stable situation because there are no unplanned changes. There are no big changes in top level management, the financial status of the company is as predicted, and the company is growing by opening new stores in the UK as planned for the year 2017.

But, there is an important external factor that brings ALDI UK in the fast-changing situation, and this factor is the so-called ‘BREXIT’. Due to new regulatory and administrative procedures that Britain would face as a non-EU nation would affect UK businesses that rely on EU-based suppliers because growing the complexity in dealing with them. Customers could be affected as they may have to wait longer or pay more for their products.

ALDI managers will have to make big changes in a short period of time in all of her/his management functions to adjust to the new situation.

Planning. To define their objective and plan, managers must be aware of the company’s environment. As BREXIT could bring a change in the trade regulations between UK and EU managers are also analysing the possible impacts on their employee attrition, on their customers and market share, and the impacts on their suppliers.

Organizing. Because there are big changes in the plan, there will be changes in implementing them. They will identify the people responsible for this and the resources that will be allocated to implement the changes.

Leading. Managers will inform what the changes are intended to achieve, and motivate the company’s stakeholders with an inspiring, shared vision of the future.

Controlling. Managers identifies the success indicators for change, and they make sure that these indicators are regularly evaluated and reported on.

Robert House (1996) suggested the path-goal theory of leadership. The theory identifies four styles that leaders may adopt and predicts what type of leader behaviour will be appropriate for what sort of circumstances. Each of these styles can be successful, depending on: the peculiarities of employees (such as their ability level, preferences, locus of control, achievement motivation) and the peculiarities of the work environment (such as the level of role ambiguity, the degree of stress present in the environment, the degree to which the tasks are unpleasant). These styles of leadership are: directive, supportive, participative and achievement-oriented

When employees are experiencing role ambiguity on the job the theory predicts that the directiveleadership will function well. When leaders need to be directive they will have to offer specific directions to their employees, they must clarify role expectations, sett schedules, and make sure that employees know what to do.

When employees are performing boring and repetitive jobs or when they are stressed or even when employees know exactly how to perform their jobs, but their jobs are unpleasant, a supportive style is predicted to be effective by providing emotional support to employees. Applying this style, leaders treat employees well, care about them on a personal level, and are encouraging them.

When employees are highly capable and when the decisions to be made are personally relevant to them, participative leadership may be more effective. Managers applying participative leadership make sure that the employees are involved in making important decisions.

When employees have both high levels of ability and high levels of motivation, achievement-oriented leadership is likely to run well. Their style challenges employees and focuses their attention on work-related goals.

A screenshot of a cell phone

Description generated with very high confidence

Predictions of Path-Goal Theory

Source: House (1996)

In an ALDI store environment tends to be stressful as all the activity in a store is targeted, from the time to arrange products on the shelf to the numbers items that are scanned by the cashier. Employees at ALDI always know what to do, as they participate in intensive training from the moment they arrive in the company, so a store manager uses a supportive style of leadership. There are exemptions that a store manager uses directive style when an employee was just hired, and he is in training, or even after the training the manager still directs her/him for a period of time depending on employee’s ability to learn and adapt. But the area managers or top managers in ALDI UK applies the participative and the achievement-oriented styles, as they mainly coordinate and collaborate with the store managers or other department managers. These employees are selected to have high abilities and to be motivated to work in this industry.

This second part examined the way that the role of a leader and the function of a manager applies in different situational contexts. It displayed the impact of the fast-changing situation that ALDI UK is in, upon the functions of its upper managers. Also, this part presented what leadership styles are used, according to their position in the company and the colleagues and subordinates they collaborate.

 

P3. The report will present in this part different theories and models of approach to management and leadership that apply in ALDI UK and help its managers to achieve company’s objective.

Although a bigger number of theories apply, the following theories are the most popular applied: situational theory, systems theory, contingency theory and chaos theory, theory X and Y.

Situational leadership was introduced by Kenneth Blanchard and Paul Hersey (1969) and is a contingency approach to leadership which argues that leaders must use different leadership styles depending on their employees’ development level. This model argues that employee readiness (defined as a combination of their competence and commitment levels) is the key factor that establish the proper leadership style that needs to be applied.

The model summarizes the level of directive and supportive behaviours that leaders may show. According to this model, if leaders use the right style of behaviours at the right time in each employee’s development, they will be more efficient. It is recognized that followers are key to a leader’s success. For employees that are at the earliest stages of developing are considered to be highly committed but with low competence leaders should be highly directive and less supportive. The leader should involve in more coaching behaviours when the employee turns out to be more competent. At moderate to high levels of competence the supportive behaviours are recommended to be used. And finally, delegating should be applied by leaders handling employees who are both highly committed and highly competent.

In ALDI’s stores, the situational leadership model is widely applied by managers. This model helps managers to deal with their employees from the moment they are hired, and they will need to be directed by the manager to do their required work, after they will be coached, then supported, until the moment that an employee achieves enough experience and become competent enough to only receive delegation from their manager to do their job.

Systems theory argues thatManagers different systems affect the worker and the worker affects the systems around. The theory suggests that the organisation is a system being made up of a variety of parts that run together to achieve a goal. Systems theory is a broad perspective that allows managers to examine patterns and events in the workplace.

This could help ALDI’s managers to coordinate programs to work as a collective whole for the overall goal or mission of the organisation instead of working for isolated departments.

Contingency theory. The contingency school postulates that there is not one best way to structure work or an organisation. An optimum course of action depends, is contingent, on the external and local conditions in which an organisation is inserted. This represents an alternative to most assumptions from scientific management and shifts the attention of organisation managers beyond internal dynamics to the external environment of an organisation.

A manager should act based on most important aspects regarding the current situation. An example is when managers in a university may use a leadership approach that includes participation from employees, while a leader in the army will use an autocratic approach.

Chaos theory claims that change is constant. Although certain events and circumstances in an organisation can be controlled, others can’t. Chaos theory admits that change is inevitable and is rarely controlled. While organisations grow, complexity and the possibility of susceptible events increase. Organisations increase energy to maintain the new level of complexity, and as organisations spend more energy, more structure is needed for stability.

Theory X and Y claims that workers naturally lack ambition and need incentives to increase productivity. Theory Y believes that workers are naturally driven and take responsibility, so, leaders encourage participation from workers. While managers who believe in Theory X values often use an authoritarian style of leadership.

Management theories are implemented to help increase organisational productivity and service quality and to achieve organisational objectives. Managers don’t use a singular theory or concept when implementing strategies in the workplace. They commonly use a combination of a number of theories, depending on the workplace, purpose and workforce. Popular management theories that are applied at ALDI, or should be used are: Situational theory, systems theory, contingency theory and chaos theory. Theory X and Y addresses management strategies for workforce motivation to help increase worker productivity.

P4. In the fourth part will be revealed the key approaches to operations management and the role that leaders and managers play.

Operations is that part of a business organisation that is responsible for producing goods and services. It is involved with converting materials and labour into goods and services as efficiently as possible to maximize the profit of an organisation. Operations management have to do with utilizing resources from personnel, raw materials, technology and equipment. Operations managers acquire, develop and deliver goods based on client wants and the capabilities of the company. Operations management deal with various strategic issues like determining the size of manufacturing plants, project management methods or implementing the structure of information technology networks. Operations management entails studying the use of raw materials and ensuring minimal waste occurs. Other operational issues include the management of inventory levels, work-in-process levels and raw materials acquisition, quality control, materials handling and maintenance policies.

There are six key approaches to operations management that includes: Total Quality Management, Just-in-Time, Continuous Improvement, Six Sigma, Lean production, and Queuing, further, each one of these will be analysed.

Total Quality Management (TQM) is the continuous process of reducing or eliminating errors in manufacturing, streamlining supply chain management, improving the customer experience, and ensuring that employees are up-to-date with their training. TQM aims to maintain all parties engaged in the production process responsible for the quality of the final product or service.

TQM was developed by William Deming, a management consultant whose work had a great impact on Japanese manufacturing.

Total Quality Management is a structured approach to overall organisational management. The focus of the process is to improve the quality of an organisations outputs by continuous improving the internal practices. The standards set as part of the TQM approach include the production of items to an apprehended norm, even if the norm is not supported by official regulations and can reflect both internal priorities and any industry standards currently in place.

While TQM come from the manufacturing sector, its principles can be utilised by a variety of organisations. It is designed to provide a cohesive vision for systemic change, with focus on long-term change over short-term goals. TQM is applied in many industries like manufacturing, banking and finance, and medicine.

The major disadvantages happen occur when first implementing TQMproduction disruption, because implementing a Total Quality Management system in a company involves extensive training of employees and take workers away from their duties, so during the initial training period, productivity can decline;

Just-in-time (JIT) is an inventory strategy to increase efficiency by receiving goods only as they are needed in the production process, thus reducing inventory costs. This method requires anticipating demand accurately.

A good example is TOYOTA a car manufacturer that operates with very low inventory levels, relying on its supply chain to deliver the parts, needed to build cars, just as they are needed.

The Just-in-time inventory control advantage over traditional models is that production runs remain short and manufacturers can move from one type of product to another easier. This method reduces warehouse storage needs and buying just enough to make the products and no more results in reduced costs.

Disruptions in the supply chain is a major disadvantage for JIT. A breakdown at a supplier can shut down the entire production process. Also ordering more goods than expected may delay delivery of finished products to clients.

Continuous improvement (Kaizen) is a philosophy and practice that appreciates improvement in productivity as a gradual and methodical process. Kaizen is a Japanese term meaning “change for the better”. It involves making the work environment more efficient and effective by creating a team atmosphere, improving everyday procedures, ensuring employee satisfaction, and making a job more fulfilling, less tiring and safer.

Some of the key ideas of the Kaizen philosophy involve embrace the elimination of waste, quality control, just-in-time delivery, standardized work. An example of the Kaizen philosophy in action is the Toyota production system, where they encourage and reward any suggestions for improvement, and when a malfunction appears the production line is stopped.

The overall goal of kaizen is to help make the business model better by making small changes over a period of time and creating improvements within a company. That doesn’t mean modifications happen slowly, it just admits that small changes now can have huge effects in the future. Improvements can come from any employee at any time.

Lean Production is about doing more with less by employing ‘lean thinking.’ Lean manufacturing goes for never-ending efforts to eliminate or reduce ‘Muda’ (Japanese for waste or any activity that consumes resources without adding value) in design, manufacturing, distribution, and customer service processes.

Lean production is a philosophy that considers any part of the enterprise which does not directly add value to the final product to be superfluous and in need of elimination. Lean production considers the product from the consumer’s perspective to establish what is of value (i.e. what the consumer is disposed to pay for), then studies the process with the purpose to reduce all of its aspects except for the value-adding ones.

The method comes from Toyota Production System, which was a management philosophy created by Eiji Toyota and Taiichi Ohno between 1948 and 1975.

Six Sigma represents an ideology that focuses on statistical improvements to a business process. Practitioners of Six Sigma are those business people who use statistics, financial analysis and project management to achieve improved business functionality. Any business process that produces less than 3.4 defects per 1 million chances is considered efficient.

Six Sigma was developed by Motorola and adopted by GE, with excellent results. The success of GE led to the wide adoption of Six Sigma by companies like Amazon, Dell, Ford Motor Company and so on.

Practitioners of the Six Sigma method follow an approach called DMAIC: define, measure, analyse, improve and control being a statistically driven methodology.

One disadvantage would be that for small manufacturers may be too expensive of attempt achieving a Six Sigma status.

Queuing Theory is a mathematical method of analysing the congestions and delays of waiting in line. This approach studies every component of waiting in line to be served, including the arrival process, service process, number of servers, number of system places and the number of customers (that can be people, cars, data packets). Real-life applications of queuing theory include providing faster customer service, improving traffic flow, shipping orders efficiently from a warehouse, reducing customer wait times and increase the number of customers that can be served and designing telecommunications systems such as call centres.

Operations especially in manufacturing companies can be difficult and sometimes dangerous, so, a good operations leader can help the operations activities by inspiring the workers and technicians to overcome the work-related difficulties and to stay safe in the workplace. Leadership capability of an operations manager would: encourage engineers to design the most innovative products or services that are appealing for customers; motivate workers to care about the quality of the jobs they are doing and the quality of the products they are producing or services that they are providing. A good operation is an effective operation that achieves the intended objective, so operations managers in their leadership roles can motivate employees to do their best to fulfil the operation’s objectives. As efficiency is a crucial issue in operations management, an operation leader persuades staff to use the organisational resources (financial, human, physical, information, and technological resources) in the best possible way with no waste. An operations leader encourages the staff to stay positive and hopeful when the operations or the company are not doing well for a period of time.

Operations managers are responsible for planning and supervising in the contexts of production, manufacturing or the provision of services. Operations managers acquire, develop and deliver goods to clients based on client wants and the abilities of the company. Operations managers improve the efficiency of the operations by studying the use of raw materials and ensuring minimal waste occurs. Managers apply numerous methods such as the economic order quantity method to decide the time and size of an inventory order to process and how much inventory to keep in stock. Operations managers are involved in coordinating and developing new processes while re-evaluating current structures. Organizing and productivity are two other key responsibilities of an operations manager, and the work often requires versatility from the operations manager. Operation managers have the major role in controlling the operations to ensure the quality and safety of the work is performed by staff or machinery in every operation process.

 

P5. Next, it will be explained the importance and value of operations management in achieving business objectives.

Although there are many business objectives, five of them are the most common ones for almost all types of business including for ALDI, and these are: ‘survival’, ‘increasing sale’, ‘maximizing profit’, ‘satisfying customers’, and ‘growth’.

Objective What does it mean?
To survive At first it is important that the business is kept alive. It might not be making any profit, but the costs aren’t too high either.
To increase sale Businesses often want to increase the amount of money that they receive from selling their product to the customers.
To grow Over time, a business will look to expand. It might do this by opening new branches, or by broadening its product range.
To satisfy

customers

Satisfied customers keep buying from the company and they recommend the company to other people. So, if the businesses want to increase the number of customers they need to satisfy their customers.
To maximise profits To make as much profit as possible, which is the reward for taking risks.
To gain a good reputation Word of mouth is one of the most powerful forms of advertising for small businesses, and it is important that customers think highly of their business, so they will return and tell others to visit too.
To increase market share All of the businesses in a particular market can claim a percentage of the sales in that market. Many businesses aim to increase the percentage of sales that they are responsible for.
To operate in an ethical and sustainable manner. It is important that businesses respect both the environment and the society in which they operate. This means they should always pay fair wages, provide good working conditions, and try to reduce pollution and waste.

Operations Management is important because of its functions that each of them help to achieve business objectives. The six crucial functions are as follow:

Operations Management is important because of setting and running required Control Systems such as quality control systems to ensure top quality products/services.

Operations Management is responsible for the crucial task of delivering the customer’s requested products by effective and efficient Distribution System. The company would not be able to sell even one product without the existence of a reliable Distribution System.

No product or service would exist if Operations Management does not transform raw materials into finished goods or services that customers asked for them. To put it simply, no transformation process means no goods or services, and no goods mean no sale, and no sales mean no survival for the organisation.

All the tasks inside of any organisation done by the variety of processes such as recruitment process, purchase process, production process, or distribution process are Process Design. Nothing can be done, and no objectives can be achieved without having required processes with this function Operations Management is able to design effective and efficient processes to reduce waste and increase the quality and speed of production and distribution.

Capacity Management is about planning and deciding how much should be produced to satisfy customers and at the same time not wasting any unused capacity in existing machineries. Operations Management is important because if the capacity is not managed properly the results would be either under-production (producing less than what customers want) or over-production (producing much more than what customers want). Each of these two mistakes can be very costly for the company.

One of the responsibilities of Operations Management is Logistics that is about transporting raw materials into the company and transporting the finished goods out of the company. Nothing can be produced if the logistics do not bring the raw materials or parts. So, no logistics means no sales.

Inventory Management is the practice overseeing and controlling the purchase process, storage and use of the components that a company uses in the production of the items it sells. Inventory management is also the practice of overseeing and controlling of quantities of finished products for sale.

Scheduling is about planning what should be done, when should be done and how should be done in every process and every project. Operations Management oversees scheduling.

Operations Management supports to achieve increasing sales by producing high-quality product/services with the lowest costs to be affordable for every potential customer.

One of the business objectives is to survive, Operations Management helps to attain this objective by reducing costs and producing quality products that would always have customers.

For customers satisfaction objective Operations Management by designing a good product and produce the product at the highest quality and distribute it on time.

Operations management is concerned with converting materials and labour into goods and services as efficiently as possible and is balancing costs with revenue to maximize the profit and realise the highest net operating profit possible.

Lean production as one of the approaches to operations management provides tools and processes to eliminate waste from the manufacturing process resulting in improved efficiency, effectiveness, and profitability.

Operations Management is important in helping the company to grow by attracting more customers due to having the best designed products with low costs and fast production.

Operations Management is important in achieving business objectives because without implementing these functions properly the company may not achieve any of its objectives or even if it achieves the objectives they would not be efficient anymore.

 

P6. In the last part of this report, we will assess the factors within the business environment that impact upon ALDI’s management and decision making by leaders & managers. Among all factors, we will explain four factors within the contemporary business environment that impact management and decision-making are: corporate social responsibility, sustainability, stakeholders and intrapreneurship.

Actions of firms that contribute to social welfare, beyond what is required for profit maximization, are classified as Corporate Social Responsibility (CSR). In order to account for the importance of social and ecological considerations in doing business, some organisations advocate the concept of the triple bottom line: social, environmental and economic or: people, planet, profit. A good CSR strategy will provide more engaged employees, better access to talent, lower capital constraints and a better reputation. In the longer term, it can deliver serious business innovation and transformation of the company culture and how the firm sees its role in the world.

For example, GOOGLE implemented Google Green, which is a corporate effort to use resources efficiently and support renewable power aggressive moves on multiple fronts.

Sustainability is about five key principles: quality of life; fairness and equity; participation and partnership, care for our environment and respect for ecological constraints – recognising there are environmental limits.

Although each company has its own reasons and motives for being more green and sustainable in business, there are some benefits to become a more sustainable company, like:

Enhanced Brand and Increase Competitive Advantage. As consumers are aware of the environment, they are more likely to choose brands produced by companies that offer ‘’energy efficient products, promote health and safety benefits, support fair labour and trade practices and commit to environmentally-friendly practices’’ (sustainability.com).

Increase Productivity and Reduced Costs. Developing more sustainable business practices, with better use and conservation of resources, operations will be streamlined increase, and costs will drop off.

Stakeholders ‘’are any groups or individuals who can affect or are affected by an organisation. They can be internal or external and they can be at senior or junior levels’’ (V.L.E., Icon College).

For internal stakeholders’ interest in a company comes from a direct relationship, such as employment, ownership or investment. Internal stakeholders are particularly important as Gary Heerkens points out: “One thing that makes internal stakeholders particularly important is that the perceived success of your project, business, strategy, department, is often judged by the perceived satisfaction of internal stakeholders” (Heerkens, 2013).

External stakeholders are considered the people who do not directly work with an enterprise but are affected in some way by the actions. Suppliers, creditors and public groups are all considered external stakeholders. For example, a town where a company is established will be an external stakeholder when the company goes over the allowable limit of carbon emissions, because it effects the town by increasing pollution.

A common problem that arises in large organisations is that they have numerous stakeholders and their various self-interests may not be aligned. For example, from the viewpoint of its shareholders, the primary goal of a corporation is to maximize profits and enhance shareholder value. As labour costs are a critical input cost for most companies, a company may seek to tightly control these costs. This might make its employees unhappy.  Efficient companies, like ALDI, successfully manage the self-interests and expectations of their stakeholders.

Intrapreneurship is encouraging certain employees to act like an entrepreneur within a larger organisation. Intrapreneurs are usually highly self-motivated, proactive and action-oriented people who are comfortable to take the initiative, even within the boundaries of an organisation, in pursuit of an innovative product or service. An intrapreneur is more comfortable that an entrepreneur because the organisation absorbs losses arising from failure. Intrapreneurship allows the freedom of experimentation and growth in an organisation.

This report revealed the impact of managers and leaders on ALDI’s operations. At the beginning it defined and compared management and leadership. Then examined different situational context of an organisation and how the role of a leader and the function of a manager should apply. In the third part, this report different theories and models of approach that are or should be applied by managers and leaders of ALDI. After, it explained the key approaches to operations management and the role that leaders and managers play. Fifth part explained the importance and value of operations management in achieving business objectives. The last part of this report assessed the factors within the business environment that impact upon operational management and decision-making by leaders and managers.

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