Mechanical Engineering - Industrial Engineering and Production Management - Discussion

The correct answer is: on the percentage of time saved.

Emerson's Efficiency Plan is a wage incentive system that rewards workers for exceeding standard production rates. The bonus is calculated based on the percentage of time saved by the worker.

Here's how it works:

- Standard time: The expected time required to complete a task.
- Actual time: The time taken by the worker to complete the task.
- Time saved: The difference between standard time and actual time.
- Bonus: A percentage of the time saved, usually 20-50%.

For example, if the standard time is 100 hours and the worker completes the task in 80 hours, they have saved 20 hours. If the bonus rate is 25%, the worker receives a bonus of 5 hours (25% of 20 hours).

The other options are not correct:

- On the percentage of time worked: The bonus is not based on the time worked, but on the time saved.
- On the percentage of standard time: The bonus is not a percentage of the standard time, but rather a percentage of the time saved.
- On the percentage of output exceeding 67% efficiency: While output is considered, the bonus is specifically calculated based on time saved, not output efficiency.

=> Emerson's Efficiency Plan aims to encourage workers to work efficiently and save time, while also providing a fair bonus structure.