Alliston Case Study Analysis: Identification of issues and Recommendations

Managerial Strategy: Analyze the Alliston Instruments pay system

Read Alliston Case study in the appendix of the course textbook and prepare a report that includes at a minimum an Executive Summary, Analysis, Recommendations and Summary. You can add charts, diagrams, tables etc. to make it appear more profession.
The overall goals of the report are to A. identify why the new pay system is not working, B. to examine the group and organization performance plans available and recommend the one that fits and addresses the problems facing Alliston. Answer the following questions in your analysis.
Chapters 4, 5 and 6 together constitute what you need to know to be able to formulate reward and compensation strategy. Chapter 4 provides the foundation for making decisions about the proportions of base pay, performance pay, and indirect pay to include in your compensation strategy, and for deciding which of the three methods for determining base pay will be used.  Chapter 5 provides the foundation for choosing among the various options for performance pay, while Chapter 6 will provide a specific process for formulating compensation strategy.  
Chapter 11 addresses design issues, not only for employee stock plans but also for three other important types of performance pay plans. Previous chapters discussed plans geared to the performance of individual employees; this chapter focuses on plans geared to the performance of work groups—notably gain-sharing and goal-sharing plans—and on plans geared to the performance of the organization as a whole—notably profit-sharing and employee stock plans.  Chapter 12 discusses the six main categories of indirect pay and the specific employee benefits included in each.
The overall purpose of this report is to recommend the most appropriate mix of compensation components and performance pay choices to include in the compensation strategy for the organization, and to design a performance pay plan and an indirect pay plan, and describe the issues that must be addressed when designing a benefits system.
1.Managerial Strategy: Analyze the pay system at Alliston Instruments in the Appendix.  Briefly explain the managerial strategy by analyzing the contextual and structural variables.  
Think about the following. Why is the new pay system apparently not working? Do you think that the individual production bonus system could work if some changes were made? What changes? Is individual performance pay suitable for this company? If management insists on some type of individual performance pay system, what type would you recommend?
2.Designing Performance Pay Plans: Suppose that management at Alliston Instruments has decided to scrap the current individual performance pay system. However, the company has not decided what, if anything, will replace this system and they have called you in to advise them. They want you to examine the group and organization performance plans available and recommend the one that fits best with Alliston and the problems it is facing. In preparing your report, be sure to include the pros and cons of each approach and reasons that your recommended approach is the best.
3.Indirect Pay Plans: Identify the six major categories of employee benefits and then recommend the specific types of benefits that you would include from each category.
4.Discuss the advantages and disadvantages of fixed versus flexible benefits plans and the circumstances in which each would be most appropriate.
5.Describe the issues that must be addressed in designing a benefits system.