Designing Performance Evaluation for Nescafe Production at Nestle - Case Study Example

Designing Performance Evaluation for Nescafe Production at Nestlé Student’s Name Institution Tutor’s Name Course Date Designing Performance Evaluation for Nescafe Production at Nestlé Many business organizations today apply performance evaluation systems to manage their operations and maximize their profits. Performance evaluation programs are not only beneficial to the managers, but also to the company’s employees (Capko 2003, p. 43). These programs provide managers with an opportunity to assess and ascertain the efficiency of the employees who work under their supervision. Evaluation appraisals assists employees to gauge their efficiency and to check how career and goal oriented they are (Rao 2004, p. 2). This report outlines the aspects of performance appraisal and how it is applied in various organizations. The report contains a well designed performance evaluation for Nescafe production at the Nestlé Company. The report also identifies how the performance evaluation is instrumental to food and beverage as a business unit strategy of the company. Lastly, the report outlines the benefits that the company can obtain from using the evaluation system in its management. Food and Beverage: Business Unit Strategy Nestle is an international company with a Swiss headquarters; the company trades in products that are related to health and nutrition. Nestle is the main branch of the Nestle Group, which is composed of the associated companies, subsidiaries and joint ventures that are distributed all over the world. The company’s products are majorly divided into liquid and powdered beverages, milk products, water, nutrition, prepared dishes, and pharmaceutical products among others (Wit & Meyer 2010, p. 786). The main business unit of Nestle USA is food and beverage. Apart from the food and beverage unit, other product lines of the company are Nestle Nutrition and Nestle Waters. The company, through the food and beverage unit, owns several brands of beverages that are consumed internationally. Some of these brands include Nescafe, Nestea and Nesquick. These brands generate huge income for the company. For instance, in 2007, each of these brands generated close to 1 billion CHF. The company produces beverages that reflect the tastes of the locals of the areas where it operates (Hill & Jones 2010, 441). The Job of Nescafe Production Nescafe production is one of the jobs that are undertaken in the food and beverage business unit. The work of Nescafe production involves a lot of tasks as it is the backbone of the business unit. The task begins immediately after the delivery of coffee beans into the factory by the farmers, who in this case, are the suppliers. While in the factory, the dried coffee beans of different types are combined to give the end product an extra smoothed taste. Roasting, which is the main important phase of the production process, begins after the right blend of beans has been achieved (Miltenburg 2005, p. 135). The roasting of the green beans is what gives coffee its unique aroma taste and flavor. The green beans are then roasted at between 175 and 241 degrees Celsius. The duration and specific degrees at which the coffee beans are roasted depend on the type of machine used and the desired flavor. The beans are then ground, after which they are brewed. Grinding is important as it increases the surface area of the beans thereby allowing easy extraction of the flavor. The brewed coffee powder is then dried either by a freezer drier, a spray drier or hot drier. The dried powder, which is soluble, is then packed for sale (Osterwalder, Pigneur, & Clark 2009, p. 236). The main duty of the department of Nescafe production is to ensure that different brands of Nescafe are produced to cater for the different tastes and social statuses of the consumers. The main brands of Nescafe in the United States include Nescafe Classic, Nescafe Select and Nescafe Green Blend. These brands are sold at different prices and they have different tastes. However, all of them have a number of similarities. They have a smooth taste that acts as a physical and mental stimulant (Miltenburg 2005, p. 136). Performance Management Process for Nescafe Production The main aim of this performance evaluation process is to provide the management of Nestle Food and Beverage with an effective way of gauging contributions made to the company by the employees in the department of Nescafe production. It provides an accurate appraisal layout that not only protects the interests of the employers, but also the interests of the employees. In addition, the evaluation system provides a way of achieving high quality and quantity in the production of Nescafe (Gitman & McDaniel 2009, p. 212). The main parts of the performance evaluation developed for the Nescafe production include an evaluation form, performance measures, a strategy for obtaining feedback, a disciplinary and termination formula, and finally, evaluation plan (Capko 2003, p. 44). An Evaluation Form The form developed, which is attached in the report as an appendix, requires that the evaluations in the Nescafe production department be carried out fairly and consistently. This is to ensure that the interests of the employees and managers working in the department are legally bound. The form focuses on the most important areas that are part of the Nescafe production process. This is to ensure that the employees and the managers in the department get all the time to address issues that affect the production process (McConnell 2005, p. 23). The most essential job performance areas have been addressed in the form to ensure that staff positions are well represented. These areas include employees’ skills and knowledge in the production process, amount of work each of them is assigned, and the attitudes of the workers regarding the part of the job that they carry out. The form provides the managers with a range of options to rank the essential areas. Some of the options provided include “far below requirements”, “meets requirements” and “exceeds requirements” (Capko 2003, p. 45). The form also provides evaluations for the personnel at the top management of the production process. In addition to the essential areas, the top management officials should be assessed on other aspects such as their ability to lead, problem-solving skills and communication abilities among other areas. This is a way of ensuring that the managers at the department of Nescafe production are apt and well equipped to hold those positions (MacLean 2001, p. 251). Performance Standards These are objective-oriented measures that gauge the workers’ performance according the standards set by the company. These standards are intended to reduce the amount of time wasted by the employees in their respective areas during the Nescafe production process. Like the evaluation form, these measures are also important as they assist the managers of the department in the evaluation processes. The measures include the specific amounts and quality objectives that are assigned to every task in the coffee production process (Deb 2009, p. 261). There are various measures set on every task in the job of Nescafe production. This report proposes that the workers at the roasting level produce at least 500 kilograms of coffee beans daily. The workers at the grinding department should ensure that all the roasted beans are grounded immediately they are produced. The third category of workers, those at the grinding level, should ensure that at least 3 quarters of the grounded beans are brewed daily. The workers in the drying section should ensure that all the brewed coffee is dried. Lastly, the workers responsible for packing should ensure that more than 3 quarters of the dried Nescafe coffee is packed and prepared for sale. Apart from the quantity of work, the standard measure developed so far can also be used to engage workers’ attitude and behavior. This report suggests that a worker in the department of Nescafe production can only be absent from job up to a maximum of 4 days in a month. This helps the managers in the department to evaluate how dedicated their workers are. The report also suggests that the workers’ attitudes be measured by their willingness to assist in a case where their colleague is not present (Capko 2003, p. 46). The performance standards in the report also comprise the performance reward system, which the report proposes should be used in motivating the employees so that they are subjected to a fair evaluation process. The evaluation system suggests that the department uses both monetary and non-monetary motivational criteria to encourage the company’s employees. The system proposes that employees who show exemplary dedication in their work be awarded pay increases and other monetary gifts to inspire their colleagues to follow suit (Griffin 2012, p. 235). Strategy for Obtaining Feedback This is another crucial component of the evaluation process developed for the production department. It addresses the ways in which the managers should receive the outcome of the evaluation process and what the evaluation team is supposed to incorporate in the process. The guidelines for obtaining feedback should be implemented as part of the implementation system for the production process (Chinos 2002, p. 49). This system suggests that the evaluation team should outsource for balanced feedback as this can make it easy to enact expectations for improvement among the employees who work at the Nescafe production department. The report suggests that the team should focus on both the weaknesses and strengths of the workers. It is through the focus on the positive and the negative sides of the employees’ work that the top management at the production department can effectively assist the employees to improve on their performance. This system suggests that every employee should be good to his or her colleagues to encourage team play. The employees should also ensure that they take care of the company’s property. The report proposes a suspension of not more than 6 years for every employee who violates these boundaries (Cole 2004, p. 357). A performance evaluation system is recommended to establish ways that can encourage the employees to give feedback to their managers. The evaluation team and the supervisors at the Nescafe production department should encourage the employees in the department to issue them with non-defensive responses. The employees should offer a non-defensive response such as what they feel when they are overstrained in their work, what they think on whether or not the reward they get matches the amount of work they carry out in the department, and what they would prefer changed in their work places. This is intended to induce a debate exchange in which the employees and the managers get to understand each other for the prosperity of the department (Capko 2003, p. 47). Disciplinary and Termination Formula It is obvious that not all employees are likely to adhere to the improvement procedures outlined in the system; some of them may still continue registering poor performance. Such a situation of poor performance can only be addressed properly by a well designed disciplinary procedure and contract termination if the situation gets worse. The disciplinary and termination formula outlines the actions that the managers at the department of Nescafe production are supposed to take in cases where an employee’s performance deteriorates further. The formula proposed in the report comprises a verbal warning, a written warning, and lastly, the termination of his/her contract (Falcone 2010, p. 39). The first part of the formula, a verbal warning, should be issued by a manager immediately he/she notices that the performance of an employee is deteriorating. A verbal warning can also be issued where an employee’s behavior, morals and attitude towards his fellow employees or his work, are noted to be deteriorating. This kind of warning is intended to compel the employee to change and keep to the rules and guidelines set by the Nescafe production department (DuBrin 2009, p. 322). After the issuance of a verbal warning, the employee may decide to change and begin to observe the rules and guidelines put across by the department of Nescafe production. However, if the employee fails to improve his performance, morals or behavior, a written warning should be prepared and issued to him (Falcone 2010, p. 40). A written warning is necessary before a termination note is issued. A written warning is known to carry weighty information and it has been proven that employees tend to take the written warning more seriously than verbal ones. A comprehensive written warning should contain essential elements such as the problems associated with the employee, the improvement expected from him/her, the assistance he could get from the managers and supervisors, and the kind of punishment to be issued (Capko 2003, p. 48). If after a written warning the employee still fails to change, a termination employment should then be issued to him or her. The termination of the contract should only be used as an option in a case where the management team has proven that the performance of the employee has greatly deteriorated and there are no signs that it may pick up again. Termination should be done in a more humanly and respectful way. The employee should be given ample time to collect all is belongings from the department and should also be given his dues if any (DuBrin 2009, p. 323). An Evaluation Plan The last part of the evaluation process is the evaluation schedule, which shows the number of times that this procedure should be conducted. This report suggests that the department of Nescafe production should conduct the performance evaluation on every 1st of June and on every 1st of December each year (Brown 2003, p. 15). This is expected to give the management enough time to do comprehensive evaluations that include all of the employees who are involved in the Nescafe production. To uphold the performance and morals of the employees in their jobs, the schedule should also include their overdue evaluations (Capko 2003, p. 48). How the Performance Evaluation Fit with the Food and Beverage Unit The performance evaluation provides the Nestle food and beverage unit, especially the Nescafe production department, with the most effective criteria for carrying out promotions, disciplinary actions, and further trainings (Kusluvan 2003, p. 582). Firstly, the evaluations processes should provide the managers with an opportunity to review and compare what the workers in the department have been doing in different years. Through the evaluation procedures, the managers can establish whether the employees’ efforts, skills, knowledge and dedication are representative of the Nestlé’s vision (Sims 2002, p. 80). Secondly, the performance evaluation can assist the managers at the Nescafe production department to set criteria for disciplining employees with poor performance. It is easy to set disciplinary actions through performance evaluation since the evaluation process contains a legitimate document that can be used to improve performance deterioration, disobedience, negligence or lack of cooperation among employees. In most cases, disciplinary actions issued through performance appraisal are not refutable as there is always evidence to support them (Kusluvan 2003, p. 584). Lastly, the performance appraisal is expected to assist the managers of the Nescafe production department to design effective procedures for training their employees. The evaluation process requires that before the issuance of a termination note, the managers and supervisors should do everything in their power to assist the affected employees to make improvements on their performance. This can only be done by subjecting these employees to special trainings that can help them grasp the skills and qualities that are expected of them (Kusluvan 2003, p. 585). Importance of the Performance Evaluation to Nestle Company This performance evaluation is expected to contribute to the overall welfare of the Nestle Company. It is expected to assist the HR departments of the company to improve the productivity of the company by developing performance-oriented employees. It is the most effective way by which the company’s managers and other leaders can enhance self-esteem and self-confidence in the employees and motivate them to work harder (Sims 2002, p. 81). In addition, the performance appraisal provides employees with an opportunity to evaluate their own progress and to make adjustments where necessary to avoid losing their jobs at Nestle. Since the proposed evaluation appraisal is expected to take place at least twice a year, it will create good work relations between the employees and the managers. This is actually a good way of reducing the slightly high employee turn-over rate at Nestle (Rao 2004, p. 6). Conclusion Many companies today have incorporated performance evaluation processes into their management systems as a way of improving their productivity. These programs provide managers with an opportunity to assess and ascertain the efficiency of the employees that work under their supervision. The programs also provide the employees with an opportunity to evaluate their own performance and make adjustments where they find it necessary to do so. This report uses Nestle to illustrate the aspect of performance appraisal and its importance to an organization. The main components of the performance evaluation designed in the report include an evaluation form, performance measures, a strategy for obtaining feedback, a disciplinary and termination formula, as well as an evaluation plan. It is proved that a well-designed performance appraisal assists companies to improve their overall performance and productivity. References Brown, DR 2003, The restaurant managers handbook: how to set up, operate, and manage a financially successful food service operation, Atlantic Publishing Company, Ocala. Capko, J 2003, ‘5 steps to a performance evaluation system: Keep your staff productive and motivated by conducting regular performance evaluations,’ Family Practice Management, vol. 10, no. 3, pp. 43-48. Chinos, PT 2002, Paying for performance: a guide to compensation management, John Wiley & Sons, New York, NY. Cole, GA 2004, Management theory and practice, Thomson Learning, London. Deb, T 2009, Managing human resources & industrial relations, Excel Books, New Delhi. DuBrin, AJ 2009, Essentials of management, Thomson Business & Economics, Mason, OH. Falcone, P 2010, 101 sample write-ups documenting employee performance problems: a guide to progressive discipline & termination, Society for Human Resource Management, New York, NY. Gitman, LJ, & McDaniel, CD 2009, The future of business: the essentials, Cengage Learning, Mason, OH. Griffin, RW 2012, Fundamentals of management, Cengage Learning, Mason, OH. 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Wit, B, & Meyer, R 2010, Strategy process, content, context: an international perspective, Cengage Learning, Hampshire. Appendix An Evaluation Form, Adapted from Capko (2003) Employee’s name ____________________________________________ Position ________________________________________ Type of review ______________________________________________ Review date _____________________________________ QUALITY OF WORK How well does the employee’s output meet the quality standards for this job? Consider accuracy, thoroughness and neatness. If a major part of this job is of a service nature, consider how acceptable the service is. ❍Far below requirements ❍ Below requirements ❍ Meets requirements ❍ Exceeds requirements ❍ Far exceeds requirements Reasoning: QUANTITY OF WORK Consider the amount of work accomplished and the employee’s ability to meet deadlines. ❍Far below requirements ❍ Below requirements ❍ Meets requirements ❍ Exceeds requirements ❍ Far exceeds requirements Reasoning: WORK HABITS Consider the employee’s planning skills, time management, safety, housekeeping, attendance, dependability and compliance with office practices. ❍Far below requirements ❍ Below requirements ❍ Meets requirements ❍ Exceeds requirements ❍ Far exceeds requirements Reasoning: ATTITUDE Consider how well this employee works with others and his or her willingness to take instructions and cooperate. ❍Far below requirements ❍ Below requirements ❍ Meets requirements ❍ Exceeds requirements ❍ Far exceeds requirements Reasoning: JOB KNOWLEDGE AND SKILLS To what extent does this employee possess and use required knowledge and skills? Consider the use of experience, judgment, skills and knowledge to perform assigned tasks. ❍Far below requirements ❍ Below requirements ❍ Meets requirements ❍ Exceeds requirements ❍ Far exceeds requirements Reasoning: How do you rate this employee’s overall performance? ❍Far below requirements ❍ Below requirements ❍ Meets requirements ❍ Exceeds requirements ❍ Far exceeds requirements How do you rate this employee’s progress since the last appraisal? ❍Far below requirements ❍ Below requirements ❍ Meets requirements ❍ Exceeds requirements ❍ Far exceeds requirements Employee’s signature _______________________________________________________ Date______________________________ Appraiser’s signature _______________________________________________________ Date______________________________ Read More