Critical Review Of Heinz Company Australia’s Performance Management Strategies

Literature Review

You are asked as an independent consultant to conduct a critical review of the company’s employee performance management strategies for Heinz Company Australia and recommend the way forward. Write a business report that answers all the three questions:

1). How was Heinz’s approach to performance management invalid in relation to Moretti’s job?

Explain your answer in relation to significance of strategic performance management, appraisal and employee feedback in organisational context.

2). How was Heinz’s approach towards employee performance management unreliable?

Discuss your answer that relates employee performance management and its impact on     strategic human resource management and organisational performances.

3). Identify the ways in which Heinz’s employee performance management could be improved. As part of your answer, make sure you explain carefully how the company should implement your recommendations because so much of success in this area depends on the ‘how’ of any strategy is implemented. 

The following essay evaluates the performance management strategies of HJ Heinz Company Australia, regarding an unfair dismissal of a sales manager in the organization. Human resource management is the most important management among all other managements in an organization, as this particular management looks after the main resource of an organization that is the human resources. The HR managers look after the job role and the job satisfaction of every employee of an organization. They even measure the standard performance and actual performance of the employees in order to find out the weaknesses of the employees. Bamberger et al. (2014) mentioned that depending upon the result; the HR managers provide training to the employees in order to achieve the goal of the organization.

In this assignment, the importance of the human resource management and the importance of the role of the strategic performance management have been studied in order to run the business effectively, efficiently and successfully. The main aim of every organization should be comprised of fulfilling the demand of the employees and to encourage them by guiding and motivating them towards the work, towards their job role as the work force is considered as the most important source for the development of the organization.

Significance of strategic performance management

The strategic performance management plays a vital role in assessing employee performance as well as employee feedback. According to Buller and McEvoy, (2012) performance appraisal shall be done half-yearly or annually. Thus, individual roles shall be assessed as per the organizational short term as well as long-term goals and object. In the case of Heinz, it was mandatory to evaluate employee performance as per the standards set by the organization. Tang et al. (2015) mentioned that strategic performance management is a procedure to establish operational strategies to assess the organization performance against the goals and objectives set at the outset. This process helps a business enterprise to recognize the errors of the business organization established at the beginning of the year.

Significance of strategic performance management

However, proper employee feedback was not gathered in relation to the operational performance of the organization. In the case of sales manager Moretti, the performance management system was invalid in relation to the Moretti job performance. It was designed to identify the discrepancies in the performance of the employee that would lead to termination. It was pre-determined at the outset that Moretti performance did not meet the expectations of the management. In this regard, it can be said that the strategic performance management emphasizes on recognition of weaknesses in the performance of the employee to assist the individual in executing the job role to perfection. Farndale and Kelliher (2013) stated that it is a structured process, which recognizes the contribution of the employee to the growth of the organization. This is more pertinent in the case of the food and beverage industry, which is subjected to vulnerable market conditions. Thus, performance of each employee has to be individually measured to fulfill the long-term objectives and the goals of the organization. According to Farndale and Kelliher (2013), mentioned that the strategic performance measures takes a number of factors into consideration like market conditions, the presence of substitute products in the market as well as the internal working environment of the organization. According to Armstrong and Taylor (2014), this process helps the organization to make certain alterations to business functionalities. Moretti was clearly informed about his termination from the business organization. However, the reasons for dismissal were not clearly mentioned. Therefore, this was not fair grounds for dismissal. It can be said that unfair strategic performance measures have led to this situation. Piening et al. (2014) noted that the low score in the annual review could not be a fair reason for the dismissal of the employee, since this was based on the rating conducted by the business organization that gave the same marks to every employee.  It was not based on actual performance of the employees and did not give a true and fair representation of the performance by the employees,

The company felt that it was not possible to prepare an individual plan for Moritt and therefore it is not justifiable. There were some performance measurement concerns on the part of the management of the organization. However, these plans were not disclosed to the sales manager of the business organization. Schalk et al. (2013) mentioned strategic performance measures require an organization to have a clear flow of communication to each employee, thereby facilitating organizational growth. In addition, employees should have well defined job roles for employees. However, Heinz did not adequately follow these regulations. There was a negative perception about the performance of the sales manager of the business organization without having based on any facts. As such, it can be said that unfair treatment has been given to Moritt about his termination from the job.

Invalid approach to performance management

According to Armstrong and Taylor (2014), performance management is defined as the positive partnership among the management and the employees of an organization that helps the employees of the firm to perform at their best possible way and to align the contribution with the values, objectives and the initiatives of the particular firm. Alfes, (2013) noted that the strategic performance management is composed of various indicators, frameworks and methodologies, which has helped the firm in formulating the strategy and to make the employees able to gain strategic insights that permits them to challenge the assumptions of strategy, to refine the strategic thinking and to inform the strategic learning and decision-making. Marler and Fisher (2013) mentioned the main tools of the strategic performance management include the management by objectives, Balanced Scorecard; Value based Management, Marr Balanced Scorecard, Results Based Leadership, Performance Prism and Result oriented management that help in running the organization ethically. The other ways by implementing which the performance review procedure within the organization can be optimized include – by setting goals effectively, by following the planning of performance, by ensuring the continuing process, byy improving the productivity of the firm through better management of the objective of the firm, by collecting various information from various sources. Jamali et al. (2015) mentioned that the other techniques by implementing which the strategic performance management can be well developed within an organization include – documentation, reviewing, by preparing adequately and by providing training to the managers of the firm.

Therefore, by analyzing the significances of the implementation of well-developed strategic performance management within an organization, it can be said that the particular organization of the case study that is HJ Heinz Company should also implement the various tools of strategic performance management. In addition to this, the management department of the firm should link the management performance with the recognition and the rewards, so that the employees of the organization get encouragement to perform their job perfectly. The performance management should encourage and evaluate the full participation and the success of a particular project and the organization. 

HJ Heinz Company approach to employee management consisted of certain discrepancies. The company had developed a rating system that gave a false representation of employee performance. In addition, it gave a low score to all the employees of the organization irrespective of the actual productivity developed by the business organization. It had a pre-determined perception towards Moritt that adversely influenced the performance management process. In this regard, Moritt was not informed of the performance management concerns that the management of the organization had towards Moritt. This hampered the productivity of the individual. Yorks and Barto (2013) noted that the concept of effective human resource management relates towards assisting employees to identify their shortcomings to help enhance the productivity rate. Besides this, it relates to dealing with employee issues at the working place. Thus, Piening et al. (2014) mentioned that effective human resource policies should positively influence individual as well as organizational performance.

Unreliable employee performance management

The workforce should be motivated enough to meet the expectations of the management. Heinz Australia has been unable to develop pertinent human resource strategies that shall have a positive impact on the performance of employee. According to Barrick et al. (2015), human resource policies should be flexible, so that it can be adopted to suit the market situation existing at that point of time. Thus, there should be proper coordination between different departments of a business organization to enhance smoother flow of communication within the organization. This shall ensure that employees coming from different cultures, nationalities and having different opinions to work as a team to achieve a common goal. Chow et al. (2013) mentioned that the primary objective of strategic human resources management is to frame policies that would enhance employee productivity rate with the limited amount of time and resources. Besides this, it aims to offer maximum employee satisfaction to the employees. Sparrow (2013) stated that a successful organizational performance is composed of many factors that shall contribute towards a sustainable business performance. In this regard, Minbaeva and De Cieri (2014) noted that operational, human resource as well as financial strategies are the three core of constituents of effective organizational performance .Therefore, is any one of the three standards do not execute consistent performance, it shall have a pertinent adverse impact on organizational performance.

The sales manager of the business organization did not get the required assistance from the human resource department to identify the performance management issues that have been influencing his performance. According to Purce (2014), employees should be motivated enough to voluntary participate in employee performance assessment procedure to serve the purpose of the organization. Any force applied to individual employees shall be detrimental to the performance of the organization. In the case of Heinz, Moritt have objections to the performance management procedure adopted in the business organization.

However, his issues was not highlighted or considered by the management of the organization. As such, this prevented a fair appraisal procedure towards Moritt and this can be largely be attributed towards the sacking of the employee. . In this context, Bosâ€ÂNehles et al. (2013) noted that it can be said that the strategic performance management can be considered invalid as it was not a fair practice in the context of employee appraisal and employee feedback. Accoding to Bondarouk and Ruël (2013), Heinz, Australia has an ineffective employee performance management implemented , which did not consider certain attributes like aptitude, skill and work history of the employee. In the context of the global market, these attributes are considered when determining employee appraisal performance in the organization. The following important recommendations can be made to assist the organization to  evaluate the existing working conditions of the business organization 

1. Re-innovation – The performance management process should be re-innovated to assist the management of the organization to put in effective procedures to ensure that fair treatment is offered to employees. This can be done irrespective of the market situation as well as the profitability levels of the brand. The re-innovation procedure shall consider all the errors or discrepancies made in the past, and would improve the organization as per the needs of the organization.
2. Appraisal policies – Effective appraisal policies should be introduced in the organization, which shall implement authentic evaluation procedures for the employees in the organization. The appraisal policies shall constitute of certain attributes like employee attendance, meeting of targets and behavior. In this regard, it can be said that authentic appraisal policies shall enable an organization to accurately measure employee performance and form organizational hierarchy.
3. Employee engagement policies- Employee engagement policies shall assist an employee to set pre-determined policies to feel a part of the organization. Thus, there shall be motivation to achieve individual and organizational goals. In this regard, it can be said that this would motivate employees to actively participate in employee performance measures procedure and to extend all the cooperation to the management of the organization.
4. Employee issue – Proper hearing must be given to employee issues to voice their concerns. It is the job of the human resource management to evaluate the employee issues so that employee issues can be dealt effectively. This would d enhance the appraisal policies followed in the organization 

Ways to improve Heinz’s employee performance management

According to Beer et al. (2015), Employee performance management procedures would have far-reaching benefits, if it were implemented effectively. As such, there are certain measures, which can be adopted to rectify the discrepancies that are having a negative impact on employee performance management procedures to assess employee performance. However, these depend on the structural constituents of the organization, and the product or service line the organization is operating.

Kaufman (2015) mentioned that each organization would have different requirements. Thus, there cannot be a unified performance management procedure to assist the business organization in its growth and development. However, Minbaeva (2013) noted that it can be said that equal treatment of employees is a pertinent requirement that is applicable to all organizations. Discrimination based on the background and gender is unlawful and therefore cannot be acceptable to the management of the organization. Kaufman (2015) mentioned that discrimination in the organization could have an essential negative impact on the employee morale. This can have a negative impact on organizational performance management as well as appraisal strategies in the context of organizational performance.

The following are the recommendations that can be mad to improve the Hienz’s employee performance management procedures, in the case of HJ Heinz Company , Australia.

1. Employee feedback – Employee feedback is an important attribute that can assist any business organization to enhance its staff performance management procedures. This shall also assist the organization to identify the errors, and assist the organization on the path of recovery. Therefore, regular collection of feedback would assist the management of the organization to judge employee morale and act accordingly.
2. Regular monitoring of employee performance – Employee performance should be regularly evaluated as well assessing their contribution to the organizational performance. According to Zikic (2015), this shall imbibe discipline and work ethics among the employee of the organization. Thus, detailed scrutiny of employee performance is an essential requirement of to facilitate employee performance measures of a business organization.
3. Grievance redressal cell- A grievance redressal cell can be established to address issues related to the issues of employees. Sikora and Ferris (2014) noted that Employees shall lodge their concerns in this entity, and this shall facilitate the workforce to execute their performances as per the management expectations. The grievance redressal cell shall look forward to identify the discrepancies in the management process in the business organization.
4. Team building – Team building exercises can be established to foster unity. As such, this would assist employees to identify themselves as a part of a team and accept cultural diversity among the workforce.  
5. Human resource policies – It is the job of the human resource department, to develop human resource strategies, that shall put an effective employee performance management system in the business organization. These shall be done after considering factors like size of the workforce, the scale of operations and the intensity of operations. The primary responsibility of the human resource department is to assist the management of the business organization to put effective structures in place to appraise employee performance effectively.
6. Equal treatment of employees- There should be equal treatment of employees irrespective of the background, culture and creed. Employees should be solely judged on the performance of the employees. This would enable the employees to have greater trust on employee performance management measures in an organization. Having a pre-determined perception would adversely influence the employee assessment procedure in the business organization.  
7. A Separate department – A separate department can be constituted in the case of employees having multinational operations. Thus, a separate department in each location shall assist the management of a business organization to identify the performance of the employees as per the goals and objectives of the organization.
8. Investing in research and development – The management of the business organization can invest in research and development to implement an effective performance management in the organization. This shall lead the employee performance measure to be executed with minimum amount of time and effort. The research and development shall help create strict guideline within which the research and development activities would be executed in an effective manner. It can be said that the amount of resources that would be required to execute a successful organizational performance measures. 

 Conclusion

It can be said that the performance management measures is an essential tool to evaluate individual and group achievements of a business enterprise. It analyzes the discrepancies in the business functionalities and makes essential recommendations. In the case of HJ Hienz company Australia, the sales manager of the organization was unduly sacked from the organization without having given any adequate reasons. The performance management issues were not disclosed to Moritt. Therefore, the performance management procedures were not fair and transparent and did not follow the correct path. A pre-determined perception was set against the employee due to whom the person was treated in an unfair manner. If the correct appraisal and human resource policies was established such situations could have been avoided.  

Effective usage of the such tools like Balanced Scorecard; Value based Management, Marr Balanced Scorecard, Results Based Leadership, Performance Prism and Result oriented management shall help the management of the organization to correctly assess the performance of the employees.  The appraisal and performance management measures is based on the constituents of fair and transparent judgment of  quarterly and half yearly performance of the management of a business enterprise.  HJ Heinz Company did not meet these criteria. In addition, the performance rating system gave a low as well as same score to each of the employees in the organization.  This hampered the evaluation process as it was designed to terminate Moritt based on performance management issues. However, there was not enough reason to take such action, and these reflected poorly on the performance. Several pertinent measures can be taken to rectify such a situation, which are – effective human resource policies, constant monitoring of employee performance and establishing a grievance redressal cell, which shall take care of employee issues in the workplace.    

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