We need to give Kanto some more help on setting up its incentives to adequately support the new switching assembly process. We cannot allow the conversion process to delay our completing switching assemblies as there is a large late delivery penalty. Also, Bids and Contracting apparently goofed and bid too low on the contract to maintain our usual margins. It appears we have to make up 3% somewhere.

1. Is an incentive program appropriate? Explain your position.

2. If so, should there be one, two, or several plans?

3. Who should be included?

4. What should be the basis for incentive payments?

5. What kind of incentives should be included?

1. What were the key variables you considered in your selection of an individual or group-based PFP system?

2. What changes in organizational characteristics would seriously affect your recommendations?

3. What circumstances would lead you to conclude that a PFP system would not be in the best interests of the organization?