Five Star Beer Breweing--Pay for Performance Case Study - Essay Example

There are also cases wherein foreign matters are found inside the beer bottles, even unfilled or short filled and poor labeling and sealing of bottles and cans. In line with increasingly tight competition in the domestic and global markets, Mr. Zhao implemented the “Pay for Performance” system in order to increase the quality of Five Star beer production. In the process, Mr. Zhao believes that monetary punishment and rewards could be used as a strong incentive to motivate employees work a better performance.

China’s new policy is to establish a new social welfare system and implement a state-owned enterprise (SOE) reform will eventually allow the domestic and foreign-funded companies to have a strong control over wages including the power to hire, discipline, and terminate employees. Problems to solve in the case of Five Star Brewing Co. include the production efficiencies particularly on the bottle-filling line where high cases of unfilled or half-filled bottles and cans as well as the packing line where most of misaligned labeling of bottles and cans occurred; the poor sanitation within the rice mill area causing insect infestation and a threat of flammable explosion; and the improvements in the company’s sales force.

To solve the problem regarding the company’s bottle-filling line, Mr. Zhao should consider the technical causes that may result to the half-filled or empty sealed bottles and cans including the poor packaging. Considering that the company has been established back in 1915, there is a huge possibility that the company’s machinery used in bottle-filling line and packing line is already obsolete and outdated. In order to improve these technical errors, it is highly recommended that the company should consider investing on a new bottle-filling and packing machinery to improve its efficiency.

In the long run, it is possible for the company