Lidl's People Management Strategies Case Study

Introduction: Exploring Lidl's People Management Strategies on Becoming the UK’s Highest-Paying Supermarket

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Individuals of many ages and socioeconomic backgrounds make up a firm. Some people thrive in a collaborative environment, while others thrive on adversity, and yet others are more analytical. Establishing appropriate administration of all branches, including personnel, is essential for a company's success. In order to deal with these discrepancies and unify the whole team, it is undeniably a significant task and here is where the necessity of people management in the firm comes into play. Employers of choice are those that are able to recruit and retain the finest employees via effective human resources management (Caputo et al., 2019). Employee morale rises as a consequence of better People Management, which in turn boosts output and efficiency.

In order to benefit the company or organisation, it may direct team activities toward accomplishing team objectives by maximising the pooled talents and capacities of personnel. As a result, this research will contribute significantly to its understanding of how to effectively manage people and organisations (Tsene and Briana, 2019). Moreover, this study will prominently evaluate the knowledge about how Lidl becomes UKs highest paying supermarket by analysing a case regarding to relevant this topic. In addition to this, how organisational change management system impact people, how organisational culture impact people and how strategic human resource management system impact diversified workplace will be demonstrated in the study.

Brief Overview of the Organisation

During “Ronny Gottschlich's” six years in charge of Lidl GB, he implemented this strategy, which caused conflict with the company's headquarters because of the high costs involved. In September 2016, Austrian marketing and operational manager Christian Härtnagel took over for Gottschlich after the latter abruptly quit. "As Lidl continues to spend heavily in the United Kingdom, the number of outlets grew from 500 to 1,500. During the 2015 fiscal year, Lidl Great Britain generated £4.7 billion in sales from its more than 630 locations throughout the UK." To be a part of Lidl US is to be a part of something monumental (Potkány and Kamodyová, 2019). In spite of its relatively recent arrival in the United States, they are one of Europe's leading retailers. In the U.S., the organisation has a distinct chance to expand on the decades of experience and develop its distinctive identity and name with consumers and workers.

Lidl strives to be an "Employer of Choice" among all organisations in the U.S. They want to do this by providing the workers with career options that they will not be able to get anyplace else. Most staff know how to reconcile their personal and professional ambitions with a supporting, team-based strategy that honours the contributions of all workers who participate to a cooperative, compassionate, and ethically aware work environment (Syed, 2020). Whether the goal is to participate in a group and be the greatest at what they do, or to rise to the position of leadership, Lidl US will help individuals succeed and provide people with possibilities to do so.

Demonstration of the Knowledge regarding Case Study

A new minimum wage of £10.10 an hour will be adopted for personnel outside of London, with highly experienced employees earning up to £11.40 an hour, according to a case study on "Lidl to become the UK's highest-paying supermarket". According to the supermarket, customers in the city's capital would have to pay extra. In the last 18 months of the pandemic, "frontline co-workers' hard effort and commitment" was credited with driving the increase, according to the study. Since early in 2013, Morrisons has been paying its employees at least £10 an hour. By 2022, starting pay will grow from £9.50 to £10.10 outside London and from £10.85 to £11.30 inside the M25, with colleagues earning up to £11.40 and $ 12.25, respectively, dependent on length of service (Simpson, 2021). Official figures were issued on Tuesday, after concerns that businesses in the hospitality and retail sectors are still having problems filling employees.

There were 1.17 million job postings in October, an increase of more than 400,000 since the beginning of the pandemic. Because of a severe labour shortage in many parts of the economy, many companies are obliged to boost pay and benefits in order to attract new workers and keep the ones they currently have. Lidl's popularity is increasing. It now has over 850 sites in the United Kingdom, and the firm says that number will rise to over 1,000 by the end of 2023. This change is being made in order to stay competitive in the market for hourly wages (Ambrose and Waguespack, 2021). As a consequence, bigger rivals with higher labour costs will feel the pinch. Lidl claims that the adjustment amounted to an increase in pay of more than 6% for certain workers.

Lidl estimated that almost 80 percent of its employees, or 21,000 individuals, would benefit. It will be £9.50 an hour in April 2022, compared with the current £8.91 an hour for the over-23 minimum wage in the United Kingdom." Over 9,000 businesses in the UK pay the "Real Living Wage," which has gone up from £9.50 to £9.90 an hour this week. Sainsbury's, Waitrose and the Co-op pay £9.50 an hour, whereas Tesco and Aldi now pay £9.55 an hour, and Asda pays £9.18 an hour (Schwartz, 2021). Lidl has announced a pay increase of £18 million as part of its investment plan in the UK.

On the subject of passing on the increased costs to customers, she said she did not anticipate to. Lidl is "fighting for talent with all the other retailers and, indeed, other companies", adding that it is now "very tough" for the company to find the right people. As much as possible, Lidl's wage increase was aimed at both retaining and attracting new staff. The grocery store company has previously indicated that it plans to add another 1,000 sites in the UK by the end of 2023. (Nguyen, 2019).

Analysis of the People Aspect of the Case

Impact of Organisational Change Management System on the People

Kotter’s Eight Step Change Management Model

• Increase Urgency: In order to fetch extensive change within the workplace, Lidl needs to proficiently identify the potential threat and lacking. Therefore, the organisation has seen that in most of the organisations, employees are striving to increase the pay scale (Pugh, 2018). In this aspect, the organisation has decided to provide £9.50 an hour in April 2022, compared with the current £8.91 an hour.
• Build Guiding Team: In this aspect, in order to increase the pay scale for the employees, the organisation is looking for the most talented and efficient staffs in the market (Sweeney et al., 2018). In this way, by recruiting most talented and proficient workers, Lidl has decided to provide sufficient guidance to them for developing their performance and productivity.
• Develop the Vision: In this way, by deciding the increment of pay scale, the organisation has also decided to develop its vision (Pugh, 2018). In this aspect, the management and executive of Lidl has fetched modifications within the organisational employee salary system to increase little the amount of salary.
• Communicate for Buy-In: Moreover, before fetching these changes within the workplace environment, the executive and the managers of Lidl need to communicate and share the information regarding the changes among all the internal stakeholders of the company (Sweeney et al., 2018). Through this, the internal stakeholders of Lidl can cope with these changes regarding the increment of employee pay scale.
• Empower Action: In this way, during the implementation and adoption of the changes within the workplace, Lidl needs to be concern about different obstacles within this process (Pugh, 2018). Thus, by mitigating all these obstacles, the organisation will be the highest paying supermarket in the UK.
• Create Short-Term Wins: Furthermore, in order to encourage the employees and guiding them to get more earnings from Lidl, the management team needs to create short-term goals (Nisar, Prabhakar and Strakova, 2019). Thereby, winning and achieving those short-term goals during the organisational job practices, the employees can achieve more rewards and cash bonuses.
• Don’t Let Up: In this way, in order for continuing the growth of the employee performance and productivity, the organisational executive and management team has decided to develop continuous short-term and long-term goals for the employees (Sweeney et al., 2018). Therefore, the organisation has been able to provide sufficient and handsome salaries to the employees for their achieving of goals.
• Make Change Stick: Thus, by implementing and adopting these changes within the workplace environment, the organisation needs to put its prominent focus on developing and maintaining the consistency of the changes in the workplace (Nisar, Prabhakar and Strakova, 2019). 

Impact of Organisational Culture on the People

Theory of Organisational Culture

• Adaptability: Merchants face a number of threats from Lidl. Because of its price, commodities, locations, and store layouts, it is a competitor to the company. Other food shops, on the other hand, are in more risk. You don't have to worry about store design or price or any of the other issues that potential competitors have had. Consider the way in which employees are treated as well as the other factors. Many grocery store employees leave their jobs because of inadequate pay or high turnover rates (Hassan and Alanazi, 2018). A great shopping experience and strong corporate culture may be achieved via employee retention.
• Mission: For retail employees in the United States, Lidl offers the highest salaries and benefits of any firm in the industry. Workers at Lidl in the United States "are recognised and rewarded for their accomplishments, feel valued for their efforts, and are motivated to continue to grow their careers with us," according to the program's website. There is a lot of information on Lidl's competition available on the company's website (Tran, 2020). Plans for retirement savings, life insurance, long-term disability insurance, employee assistance programmes, paid time off, overtime compensation for voluntary work, commuting benefits and company-sponsored social and wellness activities are all covered. There are also a variety of other benefits.
• Consistency: Earlier this week, Lidl announced that it would begin hiring for its two new stores in Virginia's Fredericksburg and Culpeper. In a press statement, the company said that "approximately 800 individuals will work in Virginia areas such as Fredericksburg, Culpeper, Bon Air, Chesapeake, Chesapeake Hampton, Henrico, Newport News, and Virginia Beach" (Odor, 2018). Workers in entry-level positions will be paid $12 an hour, plus benefits, according to a news release. Customers' perceptions of a brand are shaped mostly by its employees. People may be employed by a company that values the work they perform greatly. Overcharging is a common occurrence among consumers.
• Involvement: They got a bonus that they didn't expect, and they didn't ask for it. There are constantly new opportunities for advancement because of the constant creation of new positions. For the purpose of contrast, consider a business where there are no incentives and the only way workers can expect to see an increase in remuneration is if the government raises the minimum wage (Tran, 2020). Take a look at Lidl's remuneration for management trainees. Here, trainees who just graduated from college are in control. As soon as they start their new employment, they are given a substantial salary and, in some circumstances, a car.

Figure 2: Theory of Organisational Culture

(Source: Odor, 2018)

Evaluation of the Impact of Strategic Human Resource Management for Diversity on People

Demonstration of the Knowledge regarding Organisational Human Resource Management Policies
In order to significantly develop employee satisfaction within workplace environment of Lidl, the organisation has established and formed policies for employee relations, learning and development and talent acquisition.

• Employee Relations: If anybody has any queries or reservations concerning Lidl's approach to employee relations, they are welcome to contact us at any time. The Pulse survey is used on a regular basis to gauge how pleased its employees are at work. The strategy of "#WeAreLidl folks" is based on the findings of these polls and focus groups (Mousa and Othman, 2020). With these objectives in mind, the organisation has devised a strategy that is centred on its employees. When all of your employees are on the same page, motivated, and performing at their maximum capacity, your business has achieved effective employee participation.
• Learning and Development: As a critical component of Lidl's success, the Learning and Development department collaborates closely with the rest of the organisation to establish strategic and quantitative learning and development programmes. As a cohesive unit with coworkers around the nation, the team contributes to the growth and profitability of the organisation by making resources and training accessible to others (Yong et al., 2020). The department's personnel are prepared for both the roles they will play and those they want to perform.
• Talent Acquisition: Contribute to the filling of vacant positions at your company by joining the team responsible for locating and recruiting exceptional talent. They apply this approach in a variety of ways, including corporate reputation management, production planning, and the development of a robust application pipeline (Mousa and Othman, 2020). This ensures that all of the company's recruiting managers have the tools and resources necessary to attract and retain the top applicants. Additionally, she is responsible for using social media and the company's job website to ensure that prospects applying to Lidl have a positive experience.

Assessment of the Impact of Strategic Human Resource Management for Diversity on People

Diversity management's effects have been extensively studied in academic journals. Management of diversity has the potential to enhance the proportion of employees from underrepresented groups. Minorities opportunity-based diversification and equitable administration strategies, for instance, have a favourable impact on executive team ethnic diversity in Lidl. Racial minority mentorship programmes, minority ethnic social communities, apprenticeships for racial minorities, and professional paths for high-potential racial minorities as future managers are some of the diversity and equality managerial techniques that place an emphasis on minorities' opportunities (Michael, 2019). Manager responsibility "providing managers with incentive compensation when they fulfil organisational diversity objectives”. Because of the smaller size of the organisation, these connections tend to be more solid. The labour market has long been plagued by the issue of gender disparity, stating that the problem extends across many sociocultural, political, and financial aspects.

According to the research, variables such as socioeconomic development, gender equity and family size have a significant impact on women's employment. In the corporate world, diversity management is seen as an important HRM function that leads to improved productivity and competition for the company as a whole. The proliferation of work-life programmes confirms the favourable impacts of non-management gender diversification on organisational productivity. Instead, bad work-life balance programmes have a detrimental impact on the company's financial performance because of the lack of gender diversity in management (Rees and Smith, 2021). Work-life balance initiatives for all employees, on the other hand, are willing to reassure diversified workers regarding the company's commitment to gender diversity, which may improve the potential for diversification in increasing performance.

Employees in the Netherlands' central government, both indigenous and non-indigenous, had higher levels of emotional engagement and organisational citizenship as a consequence of diversity management, according to this study. Therefore, there are no disparities in the responses of various sociodemographic groups to diversity management activities, according to the findings. Until date, an inclusive workplace environment has been positively regarded by employees of all backgrounds (Jiang and Messersmith, 2018). In the field of cognitive effects, the ability of a group to digest information, react to stimuli, and make decisions based on that information is referred to as cognitive effects. Employees' feelings regarding their occupations, their co-workers, and the organisation as a whole are referred to as affective influences on the company. The degree of flexibility and frequency of interaction inside and outside of the team have an influence on the behavioural consequences of the interaction.

Conclusion

In this way, by considering the above discussion, it is concluded that during the organisational business operation of Lidl in the market of the UK, the organisation has set its aim to become as a highest-paying supermarket brand. In this aspect, by comparing its rival’s PayScale, it has set its PayScale at a little high. Due to this, the organisation has been significantly and efficiently able to develop its business by extensively enhancing the organisational employee engagement and retention rate.