Bob Rosen could hardly wait to get back to work Monday morning. He was excited about his chance

Part One.Part Two.

Bob Rosen could hardly wait to get back to work Monday morning. He was excited about his chance of getting a large bonus. Bob is a machine operator with Ram Manufacturing Company, a producer of electric motors in Wichita, Kansas. He operates an armature-winding machine. The machine winds copper wire onto metal cores to make the rotating elements for electric motors checked the supply of blank cores and copper wire. Finding that only one spool of wire was on hand, he asked the forklift truck driver to bring another. Then, he asked the operator who was working the graveyard shift, “Sam, do you mind if I grease the machine while you work?” “No,” Sam said, “that won’t bother me a bit.” Ram pays machine operators on a graduated piece-rate basis Operators are paid a certain amount for each part made, plus a bonus. He thought of ways to simplify the motions involved in loading, wind- A worker who produces 10 percent above standard for a certain month ing, and unloading the armatures. As Bob took over the machine receives a 10 percent additional bonus. For 20 percent above standard, after the eight o’clock whistle, he thought, “I hopeI can pull this off the bonus is 20 percent. Bob realized that he had a good chance of know the car will make Kathy happy. She won’t be stuck at home earning a 20 percent bonus that month. That would be $1,787 After greasing the machine, Bob stood and watched Sam work while I’m at work.” Bob had a special use for the extra money. His wife’s birthday was just three weeks away. He was hoping to get her a car. He had already saved $4,000, but the down payment on the car was $5,500. The Questions 9-24. Explain the advantages of a piecework pay system such as that bonus would enable him to buy the car at Ram 9-25. What might be problems associated with the piecework pay Bob arrived at work at seven o’clock that morning, although his shift did not begin until eight. He went to his workstation and system?

Expert Answer

Part 1) 9-24) Advantages of piecework pay systems-

  • Easy to understand for the workers
  • Workers get motivated to produce more output because of the bonus
  • Workers will try to simplify the process to improve the efficiency
  • Because of the higher productivity , the cost per item will be lesser which will give higher profits

9-25) Problems associated with piecework pay system-

  • Workers might not pay attention on details while trying to produce more units
  • The quality of product might be reduced because of the emphasis on producing more
  • The maintenance time of the machine might go down because of which more machine breakdowns can occur
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