Chapter 12, Problem 3E

To determine

Lean Manufacturing: Lean manufacturing aims at reducing the cost and minimizing the waste involved in the production, in order to optimize the value for the product or the service.

Situation:

Company A, manufactures men’s casual wear. Employees are paid on piece rate basis, for whatever number of units produced by them. The management wants to follow lean manufacturing system. Company A is planning of employing pull manufacturing and organizing work cells. However the management is reluctant to make hourly payment to the employees, as piece rate and incentives motivate workers to work fast or else they may not work.

To Respond: To the comments of the management.