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Question:

Explain Performance Management at Heinz Australia.
 

Performance management is one of the major factors for organizational growth in the global market. It facilitates in evaluating the productivity and contributions in the business. In recent years, the global industry has been focusing on the performance management in order to enhance the business in an appropriate manner. By analyzing the beneficial aspects of the performance management, it can be assessed that the particular process allows in obtaining organization’s objective and goals in a systematic process. On the contrary, the performance management often discourages the creativity in the business.

In this particular case study, the researcher has investigated the performance management at Heinz Australia. Fair work Australia (FWA) has evaluated that the dismissal of a sales manager called Moretti have triggered an issue in performance management at Heinz Australia (Van Dooren, Bouckaert and Halligan 2015). According to the Fair work Australia (FWA), the dismissal of an employee depends on some factors including unsatisfactory performance. However, the organization often dismisses employees unfairly. Consequently, it reduces the organization’s values and position in the global market. Hence, it can be assessed that the performance management processes have become more common issues in employment contracts within the private sector. Performance management process is involved in the process for identifying the key performer of the business. In recent years, organizations focus on the performance management in order to uphold a proper business process management in the particular industry (Rabl et al. 2012). In this context, the researcher has highlighted the performance management process conducted at Heinz. Moreover, the researcher has investigated the sales manager’s dismissal case through a detailed discussion. The researcher has also investigated the reinstatement policy conducted by Fair work Australia (FAW) for former WA sales manager called Moretti. 

Rolstadas (2012) has argued that performance management is a key factor for experiencing organizational growth in the market. With the involvement of the performance management program, the senior authority identifies the potential performer in the business. On the other hand, De Waal (2013) has highlighted the fact that proper implementation of the performance management program is responsible for achieving the goals and objectives of the business in an effective manner. In this context, Fair work Australia has found that Heinz Company Australia has unfairly treated with sales manager called Moretti. The dismissal of the sales manager was done intentionally. Moynihan and Lavertu (2012) has discussed that performance management is a systematic process it needs to be executed through several approaches. On the other hand, the senior authority of the organization is not allowed to dismiss any individual without showing any valid reason. In this context, Heinz management provided the tribunal for insisting on a distinct performance management plan for Moretti, who has a low score in his annual review. However, this low score was not an individual performance rating, but Company’s wide rating given by all employees. Ultimately, the sales manager has a contract that says Moretti has to sign the performance management plan or be dismissed from the company. Hence, it can be assessed that Heinz Australia has pressurized on the sales manager for conducting a particular thing. Mone and London (2014) has argued that the organization should not create pressure on the employee for executing certain things, which is not ethical. Moreover, the senior authority should not utilize their power to dismiss any individual from the business. On the contrary, Taticchi, Balachandran and Tonelli (2012) have argued that decision-making needs to be executed from both organization and employee’s perspective. Pollitt (2013) has highlighted the fact that forcibly decision-making is a harmful approach for the business, as it may create challenges for employee retention. Consequently, it indicates the vital issue of the business.

Significance of performance management

Heinz’s approach to performance management is a controversial context, as the senior management of the organization has dismissed sales manager without providing any valid reason. Performance management is one of the key factors that enable organization experiencing profitable outcome from the business. In this context, Heinz has continuously forced to Moretti for signing up the performance management plan. Moreover, the organization was not ready to explore the performance management plan to Moretti. Hence, it indicates the unethical method of managing performance in the business. Ates et al. (2013) have argued that Although the performance management is a key factor for achieving organization’s goals and objectives, senior management is not allowed to hide any terms and condition from the employees of the company. According to Fair Work Act 2009, the senior management needs to consider some facts before the dismissal of an employee from the company. Moreover, Fair Work Australia (FWA) has discussed that the management should identify whether the dismissal of the employee is conducted based on unsatisfactory performance or not (Aguinis, Gottfredson and Joo 2012). Hence, it can be assessed that performance management process has become common challenges for the global industry.

In this scenario, Moretti, the sales manager of Heinz, has undergone a performance review in May 2011. Later that month, Mr. Moretti has reported allegations about one of his subordinates to his line manager. The sales manager was informed that the matter would be dealt by the head office. However, the organization has not properly investigated the matter. According to the sales manager, Heinz has taken a sudden decision about the termination of his employment from the company (Lee Rhodes et al. 2012). On the contrary, Heinz has argued that the sales manager was given feedback about the performance management and was told that advice would be given from the human resource management. Hence, the incident contradicts with each other conversation. Mr. Moretti has asserted that he has asked several times to his senior management about the identification of his performance lacking areas (Sutiyono 2012). However, the sales manager has a strong belief that there was no lack of his performance. In spite of that, Heinz has terminated his employment from the organization.

By analyzing the significance of the strategic performance management, it can be assessed that the management could able to achieve the organizational objectives through the implementation of the performance management plan within the business. However, the performance management program needs to follow some guideline for conducting in an appropriate manner. Hvidman and Andersen (2014) has discussed that the Performance management system sets criteria for identifying worker contribution and productivity. It allows the business to establish organization’s activities and requirements. In this context, Heinz has dismissed the sales manager without showing any valid reason. Although the main criterion of Heinz is to manage performance within the organization, they have been focusing on the other things including employment dismissal. In this scenario, the management has not tried to identify the performance lacking areas of the sales manager. The organization could have arranged a proper discussion with Moretti about the performance management plan. However, the management has forced him to sign up a performance management plan without discussing it in a proper manner. Hence, it indicates management’s issues in conducting the performance management plan in an effective manner. As per the FWA, performance management program should consist of proper methods for obtaining profitable outcome of the process. In recent years, most of the businesses have been facing challenges in executing the performance management program due to lack of management planning and execution. Bianchi (2012) has argued that the unethical dismissal of employees could create major issues in the business, and it affects the business productivity. Consequently, it could hamper the business’s growth in the global platform. In this scenario, Heinz has dismissed the sales manager without clarifying the performance lacking areas. Consequently, it is responsible for diminishing the brand values of the business in the global market. With the involvement of the performance management planning, the organization could enhance the business opportunity in the global market (Bianchi and Rivenbark 2012). The sales manager has refused to be performance managed, as he feared that the entire program was designed to trigger his dismissal by the company. Hence, it can be assessed that Heinz has planned to terminate his employment from the company. It indicates the improper performance management process executed in the organization. Consequently, it indicates the risk factor for the business and the organization may lose its brand image in the global market.

Discussion of the case study

By analyzing the case scenario, it can be assessed that the employee’s performance management conducted at Heinz is quite unreliable. Heinz has dismissed an existing sales manager of the organization without showing real issues of the employee. In this context, the higher management has terminated the employment without providing the clarification to the employees about the identification of the performance lacking areas. Performance management is one of the major factors for experiencing the profitable outcome from the business. Taylor and Baines (2012) have identified the fact that the unreliable performance management is responsible for reducing the organizational growth in the global platform. On the other hand, Yadav and Sagar (2013) has discussed that the performance management has huge impacts on the strategic human resource management. It can be assessed that the strategic human resource management is one of the key factors for the enhancement of the work design at the workplace.

In this context, Heinz’s approach towards the sales manager was not acceptable, as the management was not ready for identifying the performance lacking areas of the sales manager. Moretti has asked several times to the higher management for evaluating the key lacking areas. Yadav and Sagar (2013) have argued that the employee’s performance management program must be followed through a guideline in order to enhance the entire process in an effective manner.  The relationship between strategic human resource management and performance management is that it defines personal development goals along with setting organizational objectives in an effective manner. Moreover, it manages the change and provides enhanced training to the employees in order to obtain profitable outcome from the business (Jelali 2012).

By discussing the employee’s performance management at Heinz, it can be assessed that the organization is not liable to provide a valid reason for terminating the employment of an employee in the business (Vukšić, Bach and Popovič 2013). For example, Moretti has asserted that the management has forced him for signing up a performance management plan without clarifying it properly, and Heinz has threatened that his (Moretti) unwillingness could cause the termination of his employment from the company. Hence, it can be evaluated from the above discussion that the performance management plan at Heinz was not reliable for employees. It directly affects the strategic human resource management and organization performances.

Strategic human resource management is one of the important factors for enhancing the organizational performance in an effective manner. In recent years, the organizational performance has been facilitating the company to enhance the financial performance, customer service, social responsibility, employee stewardship and the performance measurement systems. In this context, Heinz could have provided a detailed discussion of the performance management plan to Moretti. However, the organization has ordered him for signing up performance management plan or be dismissed from the organization. Hence, this behavioral approach of the management has indicated the bias in the process. Ahmad (2012) has discussed that organizational performance consists of several components of the business, and it must be executed in an effective manner for obtaining positive outcome from it.

Challenges of performance management

By investigating the case scenario, it can be assessed that the management’s unreliable decision on the performance management has created difficulties for Heinz in managing performance plan. Brenden McCarthy, the deputy president of Fair Work Australia (FWA), has said that the performance management plan must rely on the management and Heinz has executed the process imperfectly. Although Heinz has argued on the dismissal of Moretti, McCarthy has protested against that decision. Heinz has shown the reason that the sales manager had a low score in his annual review (Poister, Pasha and Edwards 2013). However, they have not shown him the exact areas of performance lacking. Consequently, the management has failed in conducting the performance management plan in an effective manner. With the involvement of this incident, Heinz could realize the lack of organizational performance in the business. Moreover, the strategic human resource management has failed to provide proper clarification for the termination of an employment form the business. Lack of transparency in the strategic human resource management plan could create the risk factors for enhancing organizational performance at Heinz in an appropriate manner (Hawke 2012).

There is always space for improvement in the organization for obtaining competitive advantages in the business. By investigating the case scenario, it can be assessed that Heinz’s employee performance management process is unreliable. Moreover, the higher management of the organization did not bother to take a serious decision on employment termination in the business. As per the Fair Work Australia (FWA), the organization must follow a certain regulation for executing the performance management plan in an appropriate manner (Ahmad 2012). The deputy president of FWA, Brenden McCarthy, has argued about the dismissal of the sales manager from the company, as he thought that the management at Heinz could have provided valid reason for terminating an employment form the organization.  

Hawke (2012) has discussed that the performance management can be enhanced through following several strategies in the business. The higher management of the organization needs to provide detailed discussion on the planning of performance management. In recent years, most organizations have been facing several challenges in executing employee’s performance management plan in the business. In this context, Heinz could enhance the performance management planning at the organization through the implementation of different steps as follows:

At the initial stage of the performance management program, Heinz could have communicated their expectations to the sales manager called Moretti. On the other hand, they could have emphasized the personal accountability. Taylor and Baines (2012) have argued that the organizations are responsible to provide adequate knowledge to each employee about their overall performance analysis. In this context, Heinz, in spite of providing performance analysis, terminated employment of the sales manager. Moretti have asked several times about identification of lack of performances. However, Heinz did not provide any valid clarification to him about the dismissal of employment. Hence, it can be assessed that the organization has not been communicated its expectations to employees properly.

Monitoring is another important part of the performance management. Heinz could have implemented the proper performance management plan in the business to evaluate the key performer. Although Heinz has a process of reviewing annual performance of employees, the higher management did not monitor the process properly (Bianchi and Rivenbark 2012). Consequently, it reduces the possibility of obtaining positive outcome from the performance management plan. In this context, the organization has provided annual performance management review to Moretti. However, the review planning has not been explored properly. Moretti has asked several times to the higher management about identification of his performance lacking areas.

Analysis and Conclusion

Heinz could have created administer a fair and consistent management system of acknowledging merit in the business. Most organizations have been facing challenges in accessing the performance management plan in an effective manner (Sutiyono 2012). In this context, Heinz has shown the unreliable performance management at the organization. Deputy President McCarthy has said that there was no valid reason for the dismissal of Moretti. As per the FWA, organization needs to accomplish the performance management plan through following certain guideline. However, Heinz has shown invalid reason for the dismissal of the sales manager. He was given a condition where he had to sign up for a performance management plan or be dismissed from the organization.  However, Heinz has failed to explore the performance management plan to Moretti. Hence, it can be identified that the Heinz consists of opaque management system in the business and it has created challenges for obtaining positive outcome from the business (Pollitt 2013).

Heinz could have investigated the performance management of Moretti in order to uphold a transparent management process in the business. Heinz has avoided clarifying the performance management plan to their sales manager. The organization has shown annual performance review to Moretti and the performance score was low. However, the organization has not provided any clarification of his low performance. It indicates the unreliable performance management program for the employee. Heinz could have established good example of the performance management process by executing the dismissal of an employment with valid reason. On the contrary, the management was least bother about discussing the lack of performance management areas of the sales manager. Lack of transparency in the management decisions has created difficulties for Heinz to achieve organizational goals and objectives in an effective manner (Rolstadas 2012). 

Conclusion and recommendations:

It can be concluded that performance management is one of the major factors for experiencing organizational growth in an effective manner. Fair work Australia has argued about the dismissal of an employment at Heinz. Heinz has terminated the employment of the sales manager called Moretti without showing any valid reason. Consequently, it has created a negative impact on the organization’s brand image in the global market. Heinz has evaluated that Moretti needs to develop his performance management skills. In this context, the organization has provided the annual performance management review report to the sale manager. However, Moretti has alleged that annual report contains same score given to all employees in the organization. Hence, it can be assessed that the organization has planned to terminate an employment of the sales manager. On the other hand, Moretti has alleged that the organization was least bother to provide clarification of the low score performance management at Heinz.

In this context, Heinz could have set a positive example of performance management plan by evaluating the low-performance area of employees. Fair Work Australia has also argued that the organization needs to follow a certain set of processes in order to execute the performance management planning in an effective manner. The transparent management planning could have facilitated Heinz to achieve the organizational goal and objectives in an appropriate manner. Monitoring technique is an effective process for identifying the key development area in the business. In this scenario, the hiring management of Heinz could have explored the rationale of employment’s termination from the organization. Moreover, the organization could have communicated their expectations to the sales manager in order to avoid such critical situation in the business.  

References:

Aguinis, H., Gottfredson, R.K. and Joo, H., 2012. Using performance management to win the talent war. Business Horizons, 55(6), pp.609-616.

Ahmad, M.S., 2012. Impact of organizational culture on performance management practices in Pakistan. Business Intelligence Journal, 5(1), pp.50-55.

Ates, A., Garengo, P., Cocca, P. and Bititci, U., 2013. The development of SME managerial practice for effective performance management. Journal of Small Business and Enterprise Development, 20(1), pp.28-54.

Bianchi, C. and Rivenbark, W.C., 2012. A comparative analysis of performance management systems: the cases of Sicily and North Carolina.Public Performance & Management Review, 35(3), pp.509-526.

Bianchi, C., 2012. Enhancing performance management and sustainable organizational growth through system-dynamics modelling. In Systemic management for intelligent organizations (pp. 143-161). Springer Berlin Heidelberg.

De Waal, A., 2013. Strategic Performance Management: A managerial and behavioral approach. Palgrave Macmillan.

Hawke, L., 2012. Australian public sector performance management: success or stagnation?. International Journal of Productivity and Performance Management, 61(3), pp.310-328.

Hvidman, U. and Andersen, S.C., 2014. Impact of performance management in public and private organizations. Journal of Public Administration Research and Theory, 24(1), pp.35-58.

Jelali, M., 2012. Control performance management in industrial automation: assessment, diagnosis and improvement of control loop performance. Springer Science & Business Media.

Lee Rhodes, M., Biondi, L., Gomes, R., Melo, A.I., Ohemeng, F., Perez-Lopez, G., Rossi, A. and Sutiyono, W., 2012. Current state of public sector performance management in seven selected countries. International Journal of Productivity and Performance Management, 61(3), pp.235-271.

Mone, E.M. and London, M., 2014. Employee engagement through effective performance management: A practical guide for managers. Routledge.

Moynihan, D.P. and Lavertu, S., 2012. Does involvement in performance management routines encourage performance information use? Evaluating GPRA and PART. Public Administration Review, 72(4), pp.592-602.

Poister, T.H., Pasha, O.Q. and Edwards, L.H., 2013. Does performance management lead to better outcomes? Evidence from the US public transit industry. Public Administration Review, 73(4), pp.625-636.

Pollitt, C., 2013. The logics of performance management. Evaluation, 19(4), pp.346-363.

Rabl, T., Gómez-Villamor, S., Sadoghi, M., Muntés-Mulero, V., Jacobsen, H.A. and Mankovskii, S., 2012. Solving big data challenges for enterprise application performance management. Proceedings of the VLDB Endowment, 5(12), pp.1724-1735.

Rolstadas, A. ed., 2012. Performance management: A business process benchmarking approach. Springer Science & Business Media.

Taticchi, P., Balachandran, K. and Tonelli, F., 2012. Performance measurement and management systems: state of the art, guidelines for design and challenges. Measuring Business Excellence, 16(2), pp.41-54.

Taylor, J. and Baines, C., 2012. Performance management in UK universities: implementing the Balanced Scorecard. Journal of Higher Education Policy and Management, 34(2), pp.111-124.

Van Dooren, W., Bouckaert, G. and Halligan, J., 2015. Performance management in the public sector. Routledge.

Vukšić, V.B., Bach, M.P. and Popovič, A., 2013. Supporting performance management with business process management and business intelligence: A case analysis of integration and orchestration. International journal of information management, 33(4), pp.613-619.

Yadav, N. and Sagar, M., 2013. Performance measurement and management frameworks: Research trends of the last two decades.Business Process Management Journal, 19(6), pp.947-971.

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