1. Comment on the fixed salary system that Andrew adopted from his former employer. Why was this system not effective for motivating the plant workers?

2. Do you think that scrapping the fixed salary system and replacing it with the piece- rate system was a good idea? What are some of the strengths and weaknesses of the piece-rate system?

3. Why was Andrew unsuccessful in his efforts to improve product quality? Do you think that a system of demerit points and wage deductions for the quality control workers would have been effective? Would having more supervisors in the quality control department and shipping products to Singapore for final inspection solve the problem? What do you think would be an effective way to improve product quality?

4. Were cross-cultural differences a factor in the effectiveness of the salary systems? How effective do you think each system would have been if the plant was located in North America?

5. Discuss the potential effects of implementing an MBO program in the plant. Do you think it would improve productivity and solve some of the problems?

6. Are there any conditions under which the piece-rate system might have been more effective?

7. What are some alternative ways to use pay to motivate the workers at the plant? Are there alternatives to the piece-rate system? How effective are they likely to be?
What does this case say about using money as a motivator?

8. What should Andrew do now? What would you do?