Milestone 3: Solutions Development
Solution:
The Scanlon Plan can be used as a major catalyst to turnaround the plant by emphasizing more on productivity. The more they work the faster they roll towards their bonuses; this magical spell is a win-win situation for both the employees and the management. The management can cruise steadily over the wave of bonus motivated productivity and the employees can reap the benefits from the high production rate in terms of bonuses. The plan can be redrawn and a slight change can be made by making the entire plan revolve around the concept of productivity. When productivity assumes a prime position in the plan, employees will strive hard to reach the productivity goals set in the plan, as a result the bottom line of the plant improves and sales will expand (Newstrom, 2015). The management should be vigilant in doling out the bonuses as a monthly bonus will again
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The employee goal will be the production rate and every time they achieve that, bonuses shall be doled out.
• Feedback from the employees should be valued and evaluated as this will help the management to reduce costs and maximize revenues.
• Employees will be self-motivated to achieve the desired production rate as beyond a certain payroll value they will be eligible for the bonus. This strategy will keep them on the run towards achieving a high production rate.
• Employee engagement schemes such as organizing workshops bridges the gap between the management and the employee as listening to the employee grievances solves half of the problem. The other half lies in how the management is able to provide a timeline of solutions.
• Changes and modifications in the plan should be transparent and understandable by the employees which can keep trust issues at bay.
• Engstrom should rope in an Influential leader who has the capability to infuse his beliefs in the
The Company has adopted this plan to keep things transparent and smooth functioning of the business. But the plan is still not that successful to a large extent.
Employees protested, “that supervisors should have received a reduced bonus because they were not working as hard as they are and the company might be playing with the numbers” (Beer & Collins, 2008 p.6). A beneficial system for the new Scanlon Plan is to rearranged payout count. This will help to regain trust amongst employees and management. Equity Theory stresses integrity to all compensation arrangement and if this is effectively executed, then this will resolve the mistrust issue that employees have with their management team. The rewards should not be paid on a consistent month-to-month basis, instead, on a settled proportion plan, which gives rewards "each nth time the right behavior is demonstrated" (Bauer and Erdogan, 2013, p. 112). Traditionally, this would imply that workers are paid reward each time a specific measure of cash in permitted payroll is met. “The current permitted payroll is at 38% of sales value” (Engstrom, 2008). This requires no change. Instead, when Engstrom comes to a permitted payroll of one million dollars, then 10% of that sum should naturally disbursed to workers as rewards. This tackles numerous past issues with the Scanlon
Management should share the responsibility with employees to calculate how fast bonuses are generated and earn. This may be a sensible strategy explained by the Vroom 's Expectancy theory; which suggest that people will be motivated to accomplish an objective if they feel it benefits them and also help accomplish the objective. Thus, the employees feel a significant worth of respect, and their sense of liberty increases. The modification to the Scanlon Bonus Plan directly relates to the motivation of employees and has them embrace the social system they operate in at the organization. These adjustments of the Scanlon Bonus Plan straightforwardly identifies with the motivation of employees and how they embrace the social
Adjustments must be made to the Scanlon Bonus Plan in order to increase productivity and product quality. Bonuses were paid too often which turned an incentive into compensation (Beer, 2008). Trust between employer and employees were severely disconnected due to the acts committed by management. Regardless of how necessary certain
The Plan was initiated to reward individuals for working hard and increasing the company goals financially as well. The plan included higher level management receiving employee suggestions for improvement and monthly bonuses based of the productivity increase. The plan seemed well planned until they failed to mention the monthly bonuses calculations. The Plan was not well clarified of what percentage of the bonus that everyone receives and what was it based off. The misunderstanding led to accusations form the employees that there money was being played with. The company lacked a clear channel of communication between the employees who were actually doing the productivity and the management who were less active in the plant. When the company decided to introduce the Scanlon Plan to the employees they could have easily addressed all the issues prior too it getting out of
Without a high passionate employee, the Boston Market could not stay longer. However, April said that she is studying in college right now because she think that working in the Boston Market are lack of opportunity for her to get a promotion. In order to keep April retain at the organization, Racheal want to give an offer to April to be a General Manager at the South Florida because of her be talent in managing the restaurant. Apart from that, Racheal gives her son 10,000$ for her son’s college education. April also have been given a 20,000$ student allowance to further her study and after that continue back to work with Boston Market after getting her degree. Boston Market should give more reward to their employees in return of their contribution and performance. Thus, Boston Market should incorporate a reward based performance into their organization if they wish to retain their employees. By doing this approach will motivate the employees to perform and contribute better (Lee, Singram & Felix, 2015). Silbert (2005) stated that the reward is very important because it make employees to feel that they are appreciated by their organization. When employees know that they are appreciated by the organization, they will feel happy and will contribute more and perform better. That’s why, an effective reward system can lead to employee retention (Lee, Singram & Felix,
Scanlon Plan is shorthand for schemes that reward workers (typically in industrial manufacturing companies) for suggesting and adopting new work practices that lead to improved productivity. The Scanlon Plan was named for a United Steelworks representative at a failing plant in the 1930s, Joseph Scanlon (a trained cost accountant), the impact of a company’s bottom line is greater output per dollar spent on labor and sharing the gain with the workers by paying productivity “bonuses.” Scanlon plans inherently assume workers know how to improve productivity and have to be bribed into doing so if they are given a share of the improvement.
We can see that piecework is a direct indicator of the employees output. In addition, the year end bonus is linked with the profit the company earns. The guaranteed employment provides employees the base line for their life, so they don’t have to be worried about getting fired or searching for other jobs, which makes them more concentrated on their jobs. From the combination of these three components, employees can have confidence to work and to understand that their performance will be measured properly.
The best way to motivate workers to give them as much they work so they will do their best and that’s the idea which ford adopted in early 70’s because small companies can grow with their production and the more they produce in one day the cheaper the cost will be because the companies like ford running on a chain process for instance until the tires are not completed it cannot fixed in the car.
The Goal is a book that focuses on the theory of constraints in order to improve production. Eliyahu Goldratt brings us a pleasant story that shows the important strategies that any manager or CEO should follow to be successfully productive, and capable of reaching their goals. The book easily explains and demonstrates many attainable ways for any human being to learn how to manage their industrial relations, business processes, and also, their personal lives.
In cultivating our employees' creativity and abilities, we will establish an equitable system of evaluation and rewards.
Employers are often faced with the challenge of looking for ways to boost productivity and profitability while at the same time, motivating employees to accomplish organizational goals. For many employers, variable pay plans have risen to meet this challenge. A variable pay plan ties pay increases to increased performance and productivity. One of the more popular group variable pay plans is called gain sharing. Under gain sharing pay programs, both the employer and the employee benefit from increased productivity. Therefore, gain sharing has often been referred to as a win-win pay program since it is an incentive strategy that ties pay to productivity. Gain sharing is a type of incentive plan designed to increase productivity by linking pay directly to specific improvements in a company’s performance. Gain sharing is used primarily when quantitative levels of production are important measures of business success. Gains are shared with unit/department employees on a monthly, quarterly, semiannual or annual basis according to some predetermined formula calculated on the value of gains of production over labor and other costs. The plan lets employees reap some of the rewards of their efforts through teamwork and cooperation and by working smarter and harder.
Unnecessary conflict may be prevented through employee involvement and treating employees in a fair manner. Ethical employment practices, involving employees in decisions, and treating employees as valued organizational members all work towards a positive employer-employee relationship. Unfortunately, however, it sometimes becomes necessary for an outside party to help employers and employees resolve differences through processes such as mediation or arbitration. Taken together, positive engagement strategies and constructive resolution of differences help to develop relationships which support organizational performance and success.
Bonus – As per employee wants from the employer or firm, is the bonus payment related to their work performance or production quantity with a given period of time, it is a basic want as their aim which is to work more efficiently and gain more in terms of payment through their salary with a additional payment called as bonus / performance related pay. It has and is one of the most and usual important factor as per employee / labor view of point as it gives them the efficiency power to work harder and better for its firm and the performance related pay.
Performance appraisal are very important to employees because some type of feedback is needed in order for employees to be aware of how well they are performing their job or on the contrarily, to be informed of the areas which they need improvement in. Feedback is one of the most important factors supporting high level of performance. Without performance appraisals or feedback, employees have no way of knowing whether they are doing a good job or whether there are some areas in which they need to improve (F...