OVERVIEW

What is suggestion schemes.

Objectives.
Structure. Methodology. Implementation. Defination of Wage Incentive Plans. Reasons. Different Incentive Plans. Fringe benefits

SUGGESTION SCHEMES

WHAT IS SUGGESTION SCHEMES ?

This is a method of cost reduction. The employees are working in the organization at different levels. While on the job they get number of ideas in mind to do some or other improvement in the organization.

Every improvement yields some gains. To garner these gains suggestion scheme is used.

OBJECTIVES

To share suggestions across the plant with a objective of learning from others and eliminating duplication of efforts. Track suggestions , get summary of progress and completed suggestions. Create repository of suggestions completed. To increase overall efficiency for suggestion scheme . Ensure highest employee participation.

STRUCTURE OF SUGGESTION SCHEME

Scheme Coordinator. Suggestion scheme committee. The suggestion evaluator.

The suggestor.

METHODOLOGY

A form is developed to be filled in by the suggestor which has to be filled up in same confidence. He has to write present method and proposed method. Also he has to give possible savings, which will be generated by implementing the suggestion.

Such forms are collected periodically in the company.

The suggestion coordinator checks the details and correctness of the data.

IMPLEMENTATION OF SUGGESTION SCHEME

Establishing a committee comprising of one person from Finance, The General/Deputy general manager, Industrial Engineering department, Production engineering department and from other department. The number of members need not be more than 10-12. Identify a department (Usually Industrial Engineering Dept.) and one person identified by that dept head to register the suggestion. Keep sufficient suggestion forms with that person. The suggestion can be from one person or a group of persons. Give wide publicity to suggestion scheme detail including reward system and method of giving suggestion(giving details about where forms are available, in which dept. it has to be given for registration etc., and also a request to give suggestions.

CONTINUED

The committee chairman is usually the head of the organisation and secretary from Industrial Engineering dept. Committee has to meet regularly at least one in 3 months to discuss about the suggestion, forwarding the suggestion to the connected departmental head for comment and acceptance. organize an occasion to give rewards from head of organisation, arrange for photos during giving of award of each person. Send copy of photo to three suggestor. Reward can be an appreciation letter, appreciation letter with monetary reward also.

WAGE INCENTIVE PLANS

DEFINATION
Burack and Smith: Incentive or the reward can be anything that attracts employees attention and stimulates him to work. An incentive scheme is plan or program to motivate an individual or group performance. French: Incentive system has a limited meaning that excludes many kind of inducements offered to people to perform to work or to work up to beyond acceptable work standards.

REASONS
Mutual Rewards Increased Motivation Increased Company Morale Increased Company Loyalty Increased Productivity Reduced Company Cost Team Work Reduced Absenteeism

DIFFERENT INCENTIVE PLANS

Individual Incentive Plans Piece Rate Plans: In this Plan there is direct link of increased wages to the increase in production done by the employee. Standard Hour Plans: In this case incentive is given for saving time.

CONTINUED
Group Incentive Plans
Gain Sharing: This is the sharing with employees of greater than expected gains in productivity The Scanlon Plans: Scanlon plan indicates work smarter, not harder. Employee participation is reducing labour costs, sharing of cost ratio; ratios of payroll to sales value of production; calculated monthly and compared to base month to determine bonuses. The Rucker Plan: This is similar to the Scanlon Plan. It introduces a third variable: the rupee value of all materials, supplies and services. F.W Taylor Differential Rate Plan: The main characteristic of this plan are the two rates of wage one lower and other higher is fixed. Those who fail in attaining the standard are paid at a lower rate and vice versa.

FRINGE BENEFITS
Additional

Benefits and services that are provided by a company to its employees in addition to their direct salary.

IMPORTANT FRINGE BENEFITS

Payment without work eg; Sick Leave, Maternity Leave ,Paid Vacations. Health and Safety Benefits Retirement Benefits Subsidised Housing, Transport ,lunch etc. Medical ,Legal ,Child Care, Educational Facilities Pension Plans Consumer Cooperative Stores, Interest Free Loans