IGCSE, A Level Business Student Forum

Q20 Explain one problem of using the piece-rate system in a business that uses a flow-line production system. [3]

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Possible Structure
[KN]
[AN]
[AN+]

kn: employees might focus on quantity over quality.
an: since employees are being paid according to the number of units they produce, they might compromise on quality to improve quantity.
an+:low quality products will result in the business's reputation being ruined

KN: employees focus is on more quantity
AN: as the more the quantity an employee produces the more he gets paid thus he tries making more quantity while not focusing on the quality
AN+: low quality products will lead to less sales thus business profit will also reduce

(Kn) pressure on employees.
(An) as employees would work quicker to produce more number of products to earn higher returns which would pressurize them and quality would be compromised.
(An+) this would force consumers to shift to other alternatives which may reduce business sales and overall revenue generated.

[KN] No security over the level of pay. [AN] This means that during events of production delays or breakdown of machinery, there may not be any output produced and workers may not get any pay. [AN+] As a result, the security needs of workers may not be fulfilled leading them to not feel encouraged and dedicated to work hard.

[KN]: workers might prefer quality over quantity
[AN]: low quality products would result in customer dissatisfaction
[AN+]: therefore, effect on brand image and revenue of the business

[KN]quality could be compromise
[AN]which can lead to customer not being satisfied
[AN+]which could decrase the sales of the business

[KN]The quality of the product would be compromised.
[AN]This can lead to the customer being dissatisfied.
[AN+]And ultimately reducing the consumer base and deteriorating the image of the business.

First of alll i still don't understand what a piece rate system is and what a flow line production system is!
so i'll be copying someone's answer here.

KN: employees might focus on quantity over quality.
AN: Because of this customers will not be satisfied with the product
AN+: And less sales will be generated

I would like it if we discuss this question in class.

(Kn) employees may value more quantity
(An) in order to gain maximum income they won’t prioritise quality which will damage the goods
(An+) this may damage the business reputation as due to bad quality people will stop buying

KN: Piece rate system evaluates employee worth through the amount of products they can create
AN: Creative employees will not work in an environment that is uncreative and mass producing and hence get paid less
AN+: Employee will be dissatisfied and demotivated

[KN]: Sick or Injured Workers.
[AN]: Working for piece-rate pay means that workers might come to work when they are ill, thereby risking the health of their coworkers.
[AN+]: This could shut down or seriously reduce production output.

[Kn] Compromise on Quality
[An] Since piece rate system only accounts for the no. of products made in a set period of time, workers will be more inclined towards producing more, not caring about the quality
[An+] Thus, this may result in loss of customers as they will turn towards competing businesses offering sustainable quality

(Kn) workers may become unwell because of the street of earning more.
(An)This would become a cause of fall in quality.
(An+) Therefore,this would decrease customer loyalty and production level.

Kn:Employees will focus more on quantity not the quality.
An: Leading towards low quality products produced which don’t satisfy the customer…and the sales may fall due to customers switching to other competitive brands.
An+: Less profit earned…business may collapse in future.