Question

Explain four major differences between Halsey and Rowan plans of incentive.

Answer 1

(i) Bonus - Under Halsey plan the bonus increases steadily with increase in efficiency. But in Rowan plan the bonus increases up to a certain point and starts declining thereafter.

(ii) Efficient worker- Under Rowan plan, less efficient worker may get the same bonus as a more efficient one whereas in Halsey plan less plan less efficient worker do not get bonus.

(iii) Earnings per hour - Under the Rowan plan when time saved is less than 50% of standard time, earnings per hour is higher whereas under Halsey plan when time saved is more than 50% of standard time, earnings per hour is higher.

(iv) Quality of output - The quality of work is not affected much under Rowan plan as the bonus increases at a decreasing rate at higher levels of efficiency but under Halsey Plan the quality of output decreases overtime.