In response to the scenario provided or an organisation of your choice / a business you are familiar with, you will consult with your manager (assessor) to determine resource requirements, develop a detailed action plan for the implementation of an operational plan, identify and use KPIs to monitor performance, develop a contingency plan, and develop a written proposal (simple business case) for fulfilling resource requirements in accordance with organisational policies and procedures.
c. performance indicators
d. possible risks to implementation of operational plan and potential control measures and reporting– ensure you discuss possible impact on work teams and your proposals for providing information and consultation with workers to ensure they are included in the planning process
e. problem-solving methods.
4. Develop a plan for implementing operational plan with respect to one resource (personnel, physical resource); include monitoring and reporting activities.
5. Develop a balanced scorecard for use in performance management of a team leader.
6. Develop a contingency plan for managing a risk to implementation. Include consultative activities.
7. Develop a one-page draft business case to propose resourcing. Include:
a. approximate cost for each item
b. explanation of benefit for organisation
c. summary of delegation authority and organisational procurement process.
8. Submit all documents required in the specifications below to your assessor. Ensure you keep a copy of all work submitted for your records.
Specifications
You must:
? meet with manager to discuss resourcing
? submit action plan for implementation
? submit balanced scorecard for use in performance management of team leader
? submit contingency plan
? submit a one-page draft business case.
Your assessor will be looking for:
? oral communication and literacy skills to access and use workplace information, and to prepare draft recommendations
? numeracy skills to organise supply of resources and to use budgetary information to monitor performance
? knowledge of principles and techniques associated with:
? contingency planning
? methods for monitoring and reporting on performance
? monitoring and implementing operations and procedures
? resource planning and acquisition
? tactical risk analysis including identification and reporting requirements.
Appendix 1: Scenario – StorPlus Pty Ltd
StorPlus consists of three large supermarket distribution warehouses, which supply over 50 small to mediumsized independent supermarkets and convenience stores throughout southeast Queensland.
StorPlus warehouses trade 7 days a week from 5 am to 5 pm. Each warehouse comprises a customer car park, delivery dock, dispatch dock, warehouse dry goods area, frozen goods area, five checkouts and an office complex and staff room. The business wholesales supermarket lines including dry food products, chemical cleaners, refrigerated foods, fresh and frozen produce, cigarettes, alcohol, etc.
The business uses a computerised resource management, distribution and point-of-sale system to monitor and control stock levels at each of three warehouses (Brisbane, Gold Coast and Caboolture).The main warehouse in Brisbane has an attached office space that accommodates senior management and head office administration staff.
Each warehouse employs approximately 20–30 people. Typically, the workforce of each warehouse comprises the following:
? one warehouse business manager
? picking and packing team, including manual loaders and unloaders, forklift drivers, etc. ? distribution team, including drivers ? checkout team.
Each team has one team leader. Payroll and accounting functions are managed at the Brisbane head office.
Task A
(Use this information for Task 3)
It is the middle of the 2012/2013 financial year, January 1. You are the warehouse business manager for the Caboolture warehouse. In order to implement operational plans, you will need to monitor the performance of team members with respect to those plans.
No performance reviews have been undertaken so far this financial year; therefore it is time to implement the six-month review process as per the organisation’s performance management process.
The following data is available for the picking and packing team leader, Pat Webb.
KRA KPI Target Result
Engage with
customers
% of rejected orders
Less than two complaints per 100 orders
1%
Comment from team members:
quality is really important to us and is stressed by the team leader!
Increase distribution capacity by 15% overall within financial year Picking times
5–10 minutes
7–15 minutes (weekday team)
4–7 minutes (weekend team)
$ volume of orders
handled by team
$500,000 $350,000
20% of orders needing to be declined because of backlog at
warehouse
Workers are unsure how to use new machinery
Control direct and indirect costs of operations within budget $ expenses
20% reduction in
operating expenses
Only 5% reduction because of inappropriate overtime
Waste removal up 10%
Engage workers with strategic goals of business and support professional development in line with strategic goals. (Targets to be set by individual managers) Hours of professional development and training on machinery provided for team Five hours of professional development including coaching for each team member No training
% of performance
management processes carried out
Performance management processes should be carried out for all employees twice per year Performance management on
half of staff
Comment: I need to concentrate on output, not babysitting my team. I’m not really trained in
performance management anyway
Improve health of employees (range of specific areas) Hours of OHS consultation 2 hours per quarter 1 hour to end of second quarter
Feedback: team leader thinks
OHS is a joke
You will need to:
? complete a coaching plan and run a coaching session at the earliest possible time
? complete a performance management plan to be sent to head office.
Task B (Use this information for Task 2 and 3)
It is the middle of the 2012/2013 financial year, January 1. You will need to examine the performance of the warehouse with respect to operational/strategic plans in order to provide 2–3 recommendations. These recommendations will form part of the report that the operations general manager will present to the CEO.
Examine your own scorecard for the Caboolture warehouse performance as a whole:
KRA KPI Target Result
Engage with customers
% of rejected orders Less than two complaints per 100 orders
1 complaint
Profile on survey 20% rise in profile 25% rise
% customer satisfaction with product line 89% 95%
Increase distribution capacity by 15% overall within financial year Picking times
5–10 minutes 4–15 minutes depending on team
$ volume of orders handled by team $500,000 $350,000 20% of orders needing to be declined because of backlog at warehouse
Delivery times 2–3 hours 3–4 hours
Budget and income $ expenses including
wages
$ cost of goods sold
$ revenue See budget variation
report
(25–30% of income) See budget variation report See budget variation
report
See budget variation report
Engage workers with strategic goals of business and support
professional development in line with strategic goals Hours of professional development and training on machinery provided for team Five hours of professional development including coaching
for each team member No training in picking and packing team/2– 3 hours in delivery and checkout teams.
% of performance
management processes carried out
Performance management processes should be carried out for all employees twice per year Performance management on half of staff in all teams
Improve health of employees Hours of OHS consultation 2 hours per quarter 1 hour to end of second quarter across all teams
Number of accidents requiring time off 1 per quarter 5 this financial year
Absenteeism 10 days per quarter 35 this financial year
The business is particularly concerned about the cost of stock and wage expense affecting profitability.
You are required to develop 2–3 recommendations for the operations general manager to include in their report. Because there may be a number of possible explanations for the performance data, your recommendations may be provisional and depend on gathering further information.
Appendix 2: Business Plan (excerpt)
Appendix 3: Budget
StorPlus 2012–13 Budget
Income:
Revenue $10,896,432 Sales of all products for the period.
Interest $187,000 Interest earned.
COGS $3,047,850 Cost of goods sold.
Total income $8,035,582 Gross profit.
Expenses:
Wages, salaries $3,567,890 Wages, salaries, superannuation, workcover insurance, payroll tax.
Consultancy fees $67,000 Development and maintenance of IT systems, accounting system, ERM system.
Communication expenses $56,000 Telephone, ISP costs, IT support.
Staff travel, transport and accommodation $45,500 Cost of staff travel and associated costs for sales, etc.
Premises expenses $350,000 Rent, electricity, maintenance, cleaning.
Capital expenditure $589,000 Purchase of warehouse plant and equipment, vehicles, etc.
Depreciation and amortisation $277,569 Capital equipment that is depreciated.
Office supplies $78,068 Printing and stationery, postage, amenities.
Professional fees (consultants, legal and audit), insurances, taxes and charges, subs and memberships. $22,187 Audit fees, external accounting costs, bank charges, insurance except workers comp.
Total expenses $5,053,214
Surplus $2,982,368 Net income before tax.
Page
Appendix 4: Budget variation report
Prepared by M. Zhang
StorPlus
Budget Variation ReportFY 2011/2012: Caboolture Warehouse
FY Q1 Actual $Var %Var Q2 Actual $Var %Var
REVENUE
Sales 3,200,000 800,000 780,000 (20,000) (3%) 800,000 801,000 1,000.00 0%
COGS 800,000 200,000 206,000 6,000.00 3% 200,000 230,000 30,000.00 15%
GROSS INCOME 2,400,000 600,000 574,000 (26,000) (4%) 600,000 571,000 (29,000) (5%)
EXPENSES
General andadministrative expenses
Travel 20,000 5,000 4,000 (1,000) (20%) 5,000 6,000 1,000.00 20%
Office supplies 5,000 1,250 1,000 (250) (20%) 1,250 1,000 (250) (20%)
Telephone 10,000 2,500 2,800 300.00 12% 2,500 2,800 300.00 12%
Repairs
andmaintenance 30,000 10,000 20,000 10,000.00 100% 10,000 25,000 15,000.00 150%
Payroll tax 50,000 12,500 16,250 3,750.00 30% 12,500 21,250 8,750.00 70%
Employment expenses
Superannuation 90,000 22,500 29,250 6,750.00 30% 22,500 38,250 15,750.00 70%
Wages andsalaries 1,000,000 250,000 325,000 75,000.00 30% 250,000 425,000 175,000.00 70%
Staff amenities 20,000 5,000 6,000 1,000.00 20% 5,000 5,000 0.00 0%
Occupancy costs
Electricity 40,000 10,000 8,000 (2,000) (20%) 10,000 10,000 0.00 0%
Rent 100,000 25,000 25,000 0.00 0% 25,000 25,000 0.00 0%
Water 20,000 5,000 5,000 0.00 0% 5,000 5,000 0.00 0%
Waste removal 50,000 12,500 15,000 2,500.00 20% 12,500 15,000 2,500.00 20%
TOTAL EXPENSES 1,435,000 361,250 457,300 96,050.00 27% 361,250 579,300 218,050.00 60%
Appendix 5: Operational plan
StorPlus operational plan
StorPlus operational plan (summary) FY 2012/2013
Objectives: Performance measures Tasks:
1 Engage with customers:
? raise organisational profile by 20%
? improve customer satisfaction performance by 10%. ? Percentage of wholesale customers with overall positive view of StorPlus.
? Number of wholesale customer complaints (delivery times, product quality). ? Conduct quarterly wholesale customer surveys.
? Training needs analysis and training of employees, especially sales employees.
? Continue to collect information from wholesale customers on desired/required:
o stock items o delivery timelines.
? Reduce quality variation.
2 Increase distribution capacity by 15% overall within financial year. ? Productivity figures for individuals/teams time spent picking order average time spent building skills/building skills of others ? Investigate resourcing needs for StorPlus: personnel, plant and equipment.
? Fulfil resourcing needs in accordance with policies and procedures.
? Development of contingency planning.
time loading/unloading vehicles
number of accidents spoiling goods
average delivery times from order to delivery.
3 Control direct and indirect costs of operations within budget. ? General ledger accounts; financial statements: wages
cost of goods sold
$ value of wasted or spoiled items. ? Renegotiate with suppliers.
? Research potential new suppliers.
? Reduce expenses due to wastage.
? Encourage management engagement with employees to achieve greater employee support of organisational goals.
? Greater use by managers of budgets to encourage restraint in work teams.
4 Engage workers with strategic goals of business and support professional development in line with strategic goals. (Targets to be set by individual managers.) ? Percentage completion of performance plans and performance management process.
? Numbers of coaching sessions completed. ? Management engagement with employees to achieve greater buy-in of organisational goals.
? Regular coaching.
? Training needs analysis and training.
? Strategic goals included in induction program.
? Numbers of operational-related training programs completed. ? Employee incentives for improved performance and leadership (development of other employees in line with strategic goals of organisation).
5 Improve health of employees (range of specific areas). ? Numbers of injuries (Target = 0)
? Numbers of absentees (Target = 3% of total hours. ? Training need analysis and training on machinery.
? OHS committee meetings.
? OHS risk assessment conducted regularly.
? Research possible introduction of OHS management system and employee wellness program.
? Research incentives for: safe work achievement, healthy lifestyle.
Appendix 6: Organisational structure
StorPlus organisational structure
Appendix 7: Performance management policy and procedures
StorPlus performance management policy
Purpose: The purpose of this policy is to ensure performance management is carried out consistently, fairly and transparently and in accordance with organisational requirements.
Scope: The scope of this policy covers the performance management process by employees and contractors of StorPlus
Resources: Specific procedures for the implementation of this policy are available below and on the company intranet.
Responsibility Managers/team leaders will:
? carry out biannual formal performance review discussions
? monitor individual performance throughout the year, recording key events, observations of importance which relate to the performance, both positive and negative
? refer to the performance management guidelines when carrying out tasks related to the performance management system
? use the performance management documentation to record formal and informal performance reviews
? provide employees with the opportunity to participate and contribute to their professional and personal development
? provide employees with access to training and development, as
reflected in the individual’s development plan
? provide employees with coaching and development throughout the review period
? provide employees with an opportunity to communicate their career development goals
? ensure employees complete their responsibilities in accordance with the performance management policy and process.
Relevant legislation, etc.: ? Privacy Act 1988 (Cwlth)
? Anti-Discrimination Act 1991 (Qld)
? Fair Work Act 2009 (Cwlth)
Updated/authorised: 8/8/2011 – Mary Zhang CFO
To conduct performance review
The employee’s performance will be monitored and evaluated regularly throughout the year. The performance review encompasses three elements:
? an annual formal review discussion
? a six month follow-up discussion
? continuous monitoring of the employee’s performance.
1. Annual discussion
The annual discussion is a key step in the performance review process. Essentially, this step involves compiling all the information collected and assessed throughout the year relating to the employee’s performance. However, there should be no surprises in this discussion; it is merely a summary and review of the informal and formal reviews conducted throughout the year.
The key elements of the annual discussion are to:
? reflect on performance during the year
? clarify key responsibilities of the role and review the job description
? discuss successes as well as areas for improvement
? set agreed targets and performance standards for the next six months
? agree on key areas of development for effective performance in the role.
2. Documentation
The performance review documentation provides an important guide to record standards set, targets and development plans. It is important to use the correct forms to maintain the integrity of the information, and to help the manager and employee ensure the review is completed correctly.
3. Timing
Employee performance is to be formally reviewed every 12 months with a follow-up review in six months.
A new plan should be completed at each annual appraisal discussion.
4. Six month follow-up discussion
The follow-up review provides an opportunity for managers and employees to revisit targets, standards and development plans to:
? establish that progress is on track
? identify changes impacting on the achievement of targets and standards set
? discuss development plan progress or establish development plan
? modify standards and targets, if required.
To implement performance review process
Performance management plan template
Name/position:
Manager: Review period:
Reference from operational plan (objective) Key result area
(strategic direction) Indicator of success/ performance By when Done/ reported
Appendix 8: Procurement policy and procedures
StorPlus procurement policy
Purpose: The purpose of this policy is to ensure that the acquisition of resources is carried out consistently, fairly and transparently and in accordance with organisational requirements.
Scope: The scope of this policy covers the purchasing and acquisition of resources by employees and contractors of StorPlus.
Resources: Specific procedures for the implementation of this policy are available below and on the company intranet.
Responsibility Responsibility for the implementation of this policy rests with employees and management of StorPlus with responsibility for purchasing resources.
Relevant legislation, ? Privacy Act 1988 (Cwlth)
etc.: ? Anti-Discrimination Act 1991 (Qld)
? Australian Securities and Investments Commission Act 2001 (Cwlth)
? Corporations Act 2001 (Cwlth)
? A New Tax System (Goods and Services Tax Administration) Act 1999 (Cwlth)
? A New Tax System (Goods and Services Tax) Act 1999 (Cwlth)
? Income Tax Assessment Act 1997 (Cwlth)
? Fair Work Act 2009 (Cwlth)
? Work Health and Safety Act 2011 (Qld)
? Work Health and Safety Regulation 2011 (Qld)
Updated/ authorised: 8/8/2011 – Mary Zhang CFO
x 14 Principles governing procurement process
1. Probity and ethical behaviour
The principle of probity and ethical behaviour governs the conduct of all procurement activities. Employees who have authority to procure goods and services must comply with the standards of integrity, probity, professional conduct and ethical behaviour. Employees or directors must not seek to benefit from supplier practices that may be dishonest or unethical.
2. Value for money
Value for money is the core principle underpinning procurement. Contracted organisations must be cost-effective and efficient in the use of resources whilst upholding the highest standards of probity and integrity. In general, a competitive process carried out in an open, objective and transparent manner can achieve best value for money in procurement.
3. Non-discrimination
This procurement policy is non-discriminatory. All potential contracted suppliers should have the same opportunities to compete for business and must be treated equitably based on their suitability for the intended purpose.
4. Risk management
Risk management involves the systematic identification, analysis, treatment and, where possible, the implementation of appropriate risk mitigation strategies. It is integral to efficiency and effectiveness to proactively identify, evaluate, and manage risks arising out of procurement related activities. The risks associated with procurement activity must be managed in accordance with the organisation’s risk management policy.
5. Responsible financial management
The principle of responsible financial management must be applied to all procurement activities. Factors that must be considered include:
? the availability of funds within an existing approved budget
? staff approving the expenditure of funds strictly within their delegations
? measures to contain costs of the procurement without compromising any procurement principles.
6. Procurement planning
In order to achieve value for money, each procurement process must be well planned and conducted in accordance with the principles contained in this document, and comply with all of the organisation’s policies and relevant legal and regulatory requirements.
When planning appropriate procurement processes, consideration should be given to adopting an approach which:
? encourages competition
? ensures that rules do not operate to limit competition by discriminating against particular suppliers
? recognises any industry regulation and licensing requirements
? secures and maintains contractual and related documentation for the procurement which best protects the organisation
? complies with the organisation’s delegations policy.
7. Buy Australian made/support Australian industry
Employees who are involved in procurement activities must make a conscious effort to maximise opportunities for Australian manufacturers and suppliers to provide products where there is practicable and economic value. In making a value for money judgment between locally made and overseas sourced goods, employees are to take into account:
? whole of life costs associated with the good or service
? that the initial purchase price may not be a reliable indicator of value
? the quality of locally made products
? the record of performance and delivery of local suppliers
? the flexibility, convenience and capacity of local suppliers for follow-on orders
? the scope for improvements to the goods and ‘add-ons’ from local industry.
8. Pre-registered list of contractors panel
StorPlus shall maintain a pre-registered list of contractors, following a request for expressions of interest and an evaluation of the submissions. New contractors can request to be evaluated for inclusion on the existing pre-register list at any time.
This list is reviewed at regular intervals, with admission of interested parties on a rolling basis. Care should be taken to ensure that such lists are used in an open and non-discriminatory manner. StorPlus encourages new contractors to provide information on their experience, expertise, capabilities, areas of interest, fees, and current availability. It is in the interest of the organisation that the pool of potential suppliers is actively maintained and updated. Employees should provide reports of their experiences in working with each contractor/consultant to assist future decisions concerning commissioning suitable contractors and consultants.
9. Avoid conflict of interest
Employees and directors are required to be free of interests or relationships in all aspects of the procurement process.
Employees and directors are not permitted to personally gain from any aspect of a procurement process.
Employees and directors shall ensure that to the best of their knowledge, information and belief, that at the date of engaging a contractor, no conflict of interest exists or is likely to arise in the performance of the contractor’s obligations under their contract.
Should employees or directors become aware of potential conflicts of interest during the contract period, they must advise the CEO and directors immediately.
Prior to any situation arising with potential for a conflict of interest, complete disclosure shall be made to the CEO and directors to allow sufficient time for a review.
10. Report collusive tendering
Employees should be aware of anti-competitive practices such as collusive tendering. Any evidence of suspected collusion in tendering should be brought to the attention of the CEO and directors.
11. Competitive process
It is a basic principle of procurement that a competitive process should be used unless there are justifiably exceptional circumstances. The type of competitive process can vary depending on the size and characteristics of the contract to be awarded.
For purchases of low-value products and services (less than $50,000), less formal procedures may be appropriate. Purchases might be procured on the basis of quotes from one or more competitive suppliers.
For purchases of higher value products and services ($50,000 or more) under a formal arrangement, contracts may be awarded based on responses to specifications by at least two suppliers or service providers. Where there are justifiably exceptional circumstances, the CEO must first gain written approval from the board before procurement of goods or services on the basis of only one quote where the value meets or exceeds $100,000.
12. Direct invitation (selective or restricted tendering)
A process of direct sourcing to tender may be used. This may involve:
an invitation to organisations deemed appropriately qualified for a particular product or service (this may be appropriate for specialised requirements in markets where there is a limited number of suppliers or service providers)
an invitation to tender to organisations on StorPlus’s pre-registered list of suppliers established on an open and objective basis. Where direct invitations are issued, organisations from which tenders are sought should be a good representative of all potential bidders in the market concerned. The number invited to tender should be sufficient to ensure adequate competition, and be no less than two where the value of the product or service is $50,000 or more, and should not be restricted for reasons of administrative convenience. Where there are justifiably exceptional circumstances, the CEO must first gain written approval from the chair of the board of directors before procurement of goods or services on the basis of only one quote where the value meets or exceeds $50,000. Selection from the list can be made in accordance with specified criteria. Selection may be based on factors such as overall suitability for the particular project by reference to experience, competence, and capability. The selection process should have particular regard to the need for equal treatment and reasonable distribution of opportunities.
13. Evaluation and contract award
For projects being awarded, consideration will be given not only to the most economically advantageous tender, but also to the track record of the tender respondent and the degree of confidence that the panel has in the quality if the bid. It will be the normal practice to have the evaluation of tenders carried out by a team with the requisite competency.
14. Results of tendering process
All tender respondents should be informed in writing of the result of a tendering process immediately after a contract has been awarded.
Summary of procurement policy delegations
Purchase amount Required number of quotes Comment
CEO and one director Authority to sign contracts for products and services over $100,000. Two or more competitive quotes for contracts over $50,000.
Detailed services contract required.
CEO Authority to sign contracts for products and services up to $100,000. Two or more competitive quotes, or approval from board of directors. Detailed services contract required for contracts over $20,000.
General managers
Delegated authority only through CEO Authority to sign contracts for products and services under $50,000. Two or more competitive quotes unless contractor appears on list of preferred suppliers.
Detailed services contract required for contracts over $20,000.
Warehouse business managers Authority to sign contracts for products and services under $30,000. Two or more competitive quotes unless contractor appears on list of preferred suppliers.
Provided they are within the approved budget and consistent with business/operational
and strategic planning.
Detailed services contract required for
contracts over $20,000.
Expenditure payment approval form
For completion by person verifying payment
Date Invoice date:
Payee name:
Job/project number: Project title:
Description of payment:
Payment amount: $ ? ex GST ? inc GST
Signature of person verifying payment Signature of delegated manager
x
For completion by finance:
Account number Account name Amount
Total Payable: $
x