Designing the pay-for-performance compensation plan.

You are the Compensation Manager for a large company that manufactures bicycles. The Operations
Department of the firm is responsible for manufacturing the bikes, which is done in an assembly-line fashion.
The process is quite man-power intensive. The operation makes use of 22 different assembly lines, each of
which is able to produce one bicycle every sixteen minutes. Each line requires eight workers to fully staff the
line. The lines run in two shifts and hence, the nearly four hundred assembly-line workers comprise the vast
majority of employees of the organization, there being only 21 employees in other areas.
Your company embraces the following core values:

  1. We are committed to providing bicycles of consistently high quality for the lowest price.
  2. We will always deal ethically with stakeholders.
  3. We value our employees and strive to include career-oriented persons in our staff.
  4. We are a family-oriented organization and will work with our employees to resolve family
    issues promptly.
    You have been tasked to develop a pay-for-performance plan for all assembly-line workers that will perform
    three functions:
  5. Appeal to the assembly-line workers
  6. Meet the tenets of the core values
  7. Serve to improve performance overall by reducing the time to make one bicycle by ten

Sample Solution