The main reason for reshaping the heel is to avoid a heel hook that will eventually form from excessively honing the heel back into the corner. If you do not reshape it, and continue honing, it will form a sharp corner as you now have and even a hook.
Here is an old thread where Neil Miller and Glen talk about correcting Heel Hooks. Glen references another thread in post 5, with before and after photos of a heel that he reshaped, It looks similar to yours.
It is a common problem and a very simple fix.