Importance of Written Agreement between Employee and Employer - Coursework Example

Business and dynamism are synonymous. The strength of any business is in fact the strength of its organization which keeps it firm against any adverse effect. All organization in turn comprise of teams or groups which work together toward a common goal. This is the reason why team building is such a vital and delicate concept in field of business. Team building is a managerial progress approach where managers collaborate and allocate skills to solve organizational problems. Another concept which is very relevant in this concern is of delegation. A team cannot function properly until there is a proper delegation of duties, accountabilities and autonomy. The given case study highlights few issues regarding performance of a sales manager, her appraisal, and legalities associated with employment. As evident from the case study, the company is facing a downturn. In such situation, many companies take resort to retrenching of workforce in order to cut cost. But it should be done with utmost care as competitors can take advantage of such situation and can get hold of vital information regarding company. Same dilemma exists here in the case study where a sales manager with no future growth potential is being considered for expulsion from the company. But the marketing manager is apprehensive that the sales manager can join competitors which will be detrimental for the company. But as an HR manager there are many aspects which need to be looked into, before taking any such decision. First and foremost, comes the issue of performance management. Results are not produced just by remaining busy. Moreover it goes unsaid that mere training, commitment and hard work alone are not sufficient to achieve a goal. Performance management diverts our efforts from mere business towards effectiveness and being efficient. Performance management is a management system which is result oriented. It believes in alignment of resources for the result. With ever rising competition across the all organisations must be much more careful about the performance management to remain competitive. Performance management is a philosophy in itself and can be viewed as both instigators and resultant of performance efforts. It is not clearly evident from the case study that, what sort of performance evaluation system is in place in the company. The system in place has raised questions on the future growth potential of a sales manager. This need to be carefully verified as it may be the circumstances which would lead to such a vegetating result. It may also be the lack of growth potential in the market being tapped by the sales manager. Or it may be the internal policies which may be the reason. A manager never works in isolation. Though working within the organization, a manager keeps interacting with very many external factors as well as internal factors which cast effect on managerial performance. As far as the external environment is concerned, it signifies those factors which affect the organisation from outside and falls outside the organizational boundaries. The internal factors falls within the organisational boundary and somewhat is an outcome of organisational policies. Factors like economic, legal, political, societal, competition, customers/suppliers, and technology and many more constitute external environment. By virtue of being associated with tremendous opportunity, makes the external factors relatively difficult to manage. Though there are many leading and trailing signals that can be used as guide in order to tackle external factors. Thus a continuous factor scanning is must for that. Internal factors are part of the organisation and the firm has control on such factors to an extent. The factors like organisational culture, performance management, incentive schemes, organisational discipline, and grievance addresal constitute internal environment. Managers are required to put forward strategies to align internal factors in accordance with organisational performance. Whichever the factor be, it is affected and in turn affects the human resource management. Managers are thus required to predict and take precautionary steps to avoid and ill effects on their ability to manage others. Thus the performance management system prevailing inside the company should consider all these factors before finally deciding to layoff the sales manager. It is also evident from the case study that there is not written contract between the employer and the sales manager. The absence of any such contract also points towards any written job description. This means the role and authorities of the sales manager is not clear in the company. Hence it would be very difficult to ascertain whether she is performing as per requirement or not. Though the roles and duties of a manager are not unanimously agreed upon, yet the roles and activities of any firm or organisation are more or less same. The most prevalent definition which signifies the managerial roles is that a “Manager is individual who achieve goals through other people” (Stephen P. Robbins and Timothy A. Judge, 2007, P. 8). Thus whatever the allocated job of a manager is, the people skill takes a prominence. “It can be an argument that planning, organizing, staffing, directing, and controlling describe what management is and not how it is carried out”. Going further, there is no legal ground, in absence of any written contract, to prohibit the sales manger to join any rival firm. In such case the cost benefit analysis would reveal that it is more detrimental for the company to lay her off that to keep her at the present efficiency level. As a matter of fact legislations pertaining to employment rules are imposed in form of agreements, licence, contracts, affiliations and corporate governance laws. Apart from it there exist many other ad-hoc regulations disseminated by organisations. It is jot that she has stopped performing. The assessment just conveys lack of future potential. The company in such scenario should avoid laying her off. Rather the company can exploit her experience by putting her in a sales team. The team head can have various powers (Eugen, 2000) to get the team working along with this sales manager. Figure 1: Influence Strategy and respective power source to influence performance Company from now onwards must incorporate a written contract document. This document must also contain restraint of trade clause in order to protect the interest of the company. The purpose of a restraint of trade clause is to prevent the employee from later using the employer’s trade secrets or confidential information to aid one of the employer’s competitors. In deciding whether the restraint should be enforced, the courts will consider whether it is: Unfairly restrictive Essential to protect business interests Against the public interest The following is an example of such clause: “The Employee covenants that she/he shall not for a period of three months from the date of termination of his employment, anywhere in Victoria, directly or indirectly as sales manager, singularly or jointly with or on behalf of any other entity, without the prior consent of Catastrophe Concepts carry on, advise or be engaged or interested in or associated with any business or activity which is directly or indirectly competitive with the Company." The clause reasonable in sense that a restraint period of 3 months is an appropriate period to protect Catastrophe Concepts’ legitimate business interests. Going further the geographical restraint with reference to “anywhere in Australia" is too wide to be enforceable. Catastrophe Concept’s business operated only in Victoria (it is an assumption). Also it attempts to prevent Karen from activities as a salesman only rather than restricting her from employment of any nature whatsoever with a direct or indirect competitor. Any such contract would have helped the company in restructuring the workforce with ease. This case highlights the importance of written agreement between employee and employer. At the same time it also highlights the difficulties in performance evaluation in absence of any written job description. The case study points towards the fact that evaluation of performance should be done keeping the internal as well as external factors in mind. 1. References a. Kaplan, Robert S. and Norton, David P., “The Balanced Scorecard – Measures That Drive Performance”, Harvard Business Review on Measuring Corporate Performance, 1998 edition, pp. 123-141 b. Hunger, J. David and Wheelen, Thomas L., Strategic Management and Business Policy, Pearson Education Asia, Prentice Hall, Eighth Edition, pp. 250-251. c. Tarnow, Eugen (2000). A quantitative model of the amplification of power through order and the concept of group defense. http://cogprints.org/4275/ (Surfed on 25th July 2009) d. Daniel Katz; Robert Louis Kahn (1966). The social psychology of organizations. New York: Wiley e. Henry P. Knowles; Borje O. Saxberg (1971). Personality and Leadership Behavior. Reading, Mass.: Addison-Wesley. pp. 884–89 f. O'Connor, J. & McDermott, I. (1997). The Art of Systems Thinking: Essential Skills for Creativity and Problem-Solving. San Francisco: Thorsons Publishing. p. 11. g. Simon Briscoe, 2005, The trouble with targets, OECD Observer, No. 246-247 h. Read More