Analysis of Performance Management at Fonterra Co-operative

This report analyzes the performance management practices of Fonterra, a New Zealand-based dairy cooperative. It examines the impact of performance appraisal methods, such as the rating scale, on employee effectiveness and organizational culture. The report identifies two key employee performance problems: lack of strategic focus and insufficient leadership support. It then delves into the development of a training program for marketing executives, detailing training content and applying Kirkpatrick's Four Levels Model to evaluate its effectiveness. The report concludes by summarizing the strengths and weaknesses of the performance appraisal system and the training program, highlighting the importance of clear communication, product knowledge, and strategic focus for improving employee performance. The report's findings are based on an analysis of Fonterra's operations and the implementation of various performance management tools.

Running head: TEAM DEVELOPMENT
TEAM DEVELOPMENT
Name of the Student
Name of the University
Author Note

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Executive Summary
The main purpose of report is analyse the performance management based activities that have
been performed by an organization named Fonterra. The main aim of the report is to conduct
a research on the ways by which performance management based programs are able to affect
the effectiveness of the employees and organizational culture as well. Fonterra is a dairy
based cooperative that is owned by more than 10000 farmers in New Zealand. The research is
based on the implementation of performance appraisal method like, rating scale. On the other
hand, the implementation of a proper training programme for the marketing executive is
another major part of the research that has been made in the report. The conclusion is based
on the strengths and weaknesses of the training programme and performance appraisal based
method of the organization.

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Table of Contents
1. Introduction................................................................................................................3
2. Findings and Analysis................................................................................................3
2.1 Performance appraisal..........................................................................................3
(a) Two major employee performance problems.......................................................3
(b) Best performance appraisal methods....................................................................4
2.2 Development of the training programme.............................................................5
(a) Training title.........................................................................................................5
(b) Training content....................................................................................................5
(c) Kirkpatrick’s Four levels model...........................................................................5
3. Conclusion..................................................................................................................6
References......................................................................................................................7

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1. Introduction
Fonterra Co-operative Group Limited is a multinational dairy based co-operative
organization that is owned by more than 10,500 farmers of New Zealand. The organization
operates in the dairy based industry of the country and has developed a leadership position as
well. The vision statement of Fonterra is based on the ways by which the organization aims at
becoming the natural source related to daily nutrition for old and young people
(Fonterra.com., 2019). The mission statement of Fonterra is related to the enhancement of the
standards and maintaining a leadership position in dairy based industry. Transformational
leadership based structure has been adopted by Fonterra. The performance management is
considered to be an important factor which helps in the proper development of culture in the
organization (Fonterra.com., 2019).
2. Findings and Analysis
2.1 Performance appraisal
Performance of the employees in Fonterra can be managed in an effective manner
with the help of proper communication process and effective feedback process. The
expectations of the management of Fonterra from the employees is an important factor which
is able to affect the performance levels in a huge manner. The process of performance
appraisal is considered to be important for the ways by which the performance levels of
employees can be managed (Albrecht, Bakker, Gruman & Macey, 2015).
(a) Two major employee performance problems
Fonterra has faced some major employee performance based issues which have led to
the huge number of layoffs within the organization. The two major issues that are faced by
the organization related to performance management are as follows,

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 Lack of effective levels of strategic focus – The employees of Fonterra lack
the strategic focus that is related to effectiveness of the performance. The
performance of employees in Fonterra are affected in a negative manner by the
lack of proper focus on the strategies and goals which have been set by the
organization (Deery & Jago, 2015).
 Lack of proper leadership support – The leadership and management based
activities within the organizational operations of Fonterra are not effective in
improving the productivity of the employees. Performance levels of the
employees are affected in a negative manner by the actions and behaviour
which is depicted by the leaders in Fonterra (Engelen, Gupta, Strenger &
Brettel, 2015).
(b) Best performance appraisal methods
The performance appraisal methods which can be implemented by the organization is
the rating scale based method. This process involves different objectives that are set for the
employees. The individuals are thereby rated by the managers with respect to the
performance levels. The assessment centre based method can be implemented by the
organization with the aim to test the employees based on certain social situations (Gerrish,
2016).
The position for which the performance appraisal based methods can be implemented
is the marketing executive of Fonterra. The performance levels of the marketing executive
can be affected in a positive manner by the performance appraisal method. The customers
and employees of the organization are major stakeholders who are affected by the
performance management system (Katsikeas, Morgan, Leonidou & Hult, 2016).

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2.2 Development of the training programme
(a) Training title
The training title is improvement of performance.
Objective – The objective of the training programme is to improve the productivity
levels of the marketing executive of Fonterra.
Date – 15th January, 2019. Time – 10 a.m. to 3 p.m.
Trainee – The marketing executive of Fonterra.
Trainer – The marketing manager of Fonterra.
Resources – Training based information.
Logistic arrangement – Projector, laptops and internet connectivity.
(b) Training content
The two major customer service skills which need to be learned by the marketing
executive of Fonterra are, clear communication skills and knowledge related to the products.
The marketing executive needs to interact with the customers directly and the development of
communication skills is an important factor that is able to affect the relationship of the
customers with the organization. The knowledge of products that are provided by Fonterra
need to be gained by the marketing executive in order to fulfil the needs and demands of the
customers (Leroy, Anseel, Gardner & Sels, 2015).
(c) Kirkpatrick’s Four levels model
Kirkpatrick’s four level model can be used for analysing the effectiveness of training
programme. The successive levels of training programme is able to represent measures based
on effectiveness of the training based activities. The four major levels of Kirkpatrick’s four

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kevel model include, reaction, learning, behaviour and results. These levels are able to play a
key role in the ways by which training programme can be implemented within the
organization. The effectiveness of training programme for Fonterra is analysed with the help
of this model (Vivares-Vergara, Sarache-Castro & Naranjo-Valencia, 2016).
3. Conclusion
The performance appraisal systems that can be implemented in the organization have
a major strength which is based on rating provided to employees. The weakness on the other
hand is based on biasness which can affect the rating of employees. A major strength of the
training programme is based on increasing the levels of productivity of the employees. A
weakness is based on the negative effect that the lack of knowledge of the trainer can have on
the training based program.

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References
Albrecht, S. L., Bakker, A. B., Gruman, J. A., Macey, W. H., & Saks, A. M. (2015).
Employee engagement, human resource management practices and competitive
advantage: An integrated approach. Journal of Organizational Effectiveness: People
and Performance, 2(1), 7-35.
Deery, M., & Jago, L. (2015). Revisiting talent management, work-life balance and retention
strategies. International Journal of Contemporary Hospitality Management, 27(3),
453-472.
Engelen, A., Gupta, V., Strenger, L., & Brettel, M. (2015). Entrepreneurial orientation, firm
performance, and the moderating role of transformational leadership
behaviors. Journal of Management, 41(4), 1069-1097.
Fonterra.com. (2019). Retrieved from https://www.fonterra.com/nz/en.html
Gerrish, E. (2016). The impact of performance management on performance in public
organizations: A meta‐analysis. Public Administration Review, 76(1), 48-66.
Katsikeas, C. S., Morgan, N. A., Leonidou, L. C., & Hult, G. T. M. (2016). Assessing
performance outcomes in marketing. Journal of Marketing, 80(2), 1-20.
Leroy, H., Anseel, F., Gardner, W. L., & Sels, L. (2015). Authentic leadership, authentic
followership, basic need satisfaction, and work role performance: A cross-level
study. Journal of Management, 41(6), 1677-1697.
Vivares-Vergara, J. A., Sarache-Castro, W. A., & Naranjo-Valencia, J. C. (2016). Impact of
human resource management on performance in competitive priorities. International
Journal of Operations & Production Management, 36(2), 114-134.