Question 1

The employees at MyBike Enterprise are integral to company success. The company builds custom bicycles for its customers. Its ability to build quality bicycles to specification has become a competitive advantage. At MyBike, customers will place order based on their own specifications. Upon receiving orders, the workers will work in teams to build the bicycles

There are between six to eight different steps in building the bicycles. The teams at MyBike comprised of workers that have knowledge of only one or two steps. Few know all eight steps in assembling a bicycle. At the end of the day, workers at MyBike will receive an hourly pay rate plus team base bonus payment for each bike that is built on time and with no defect.

In your opinion, is it effective for MyBike to use hourly pay rate to pay its worker? Justify your answer using ONE (1) point (5 Marks)

Discuss ONE (1) potential compensation issue that might arise from the fact that only few employees know all eight steps in assembling a bicycle. (5 Marks)

Since only few workers at My Bikes have all the knowledge on the eight steps to build a bicycle, discuss an appropriate pay plan that MyBike can use to encourage its workers to learn all the steps in building bicycle. Explain how this plan will help motivates the workers to learn all the process. (5 Marks)