The Indian economy is entering a new era of a domestic competition and globalization. In the industrial scenario, all the manufacturing organizations need to continually increase productivity and reduce costs in order to be competitive. The better way for increasing productivity is restructuring the rewarding scheme given to the employees of the organization. The rewarding scheme introduced by Mark Taylor in 1984 concentrates more on individual efficiency only. The method of rewarding is not suitable for this current global manufacturing scenario. The objective of this research paper is to design a suitable rewarding system for a Continuous Line Manufacturing System (CLMS) industry. The new rewarding system for the employees in the organization has been evaluated and implemented in a condom manufacturing industry located in south India.

In general, manufacturing is the process of conversion of raw material to finished goods by utilizing the resources. The resources are Men (labor), Material (consumable), Machines (equipment), Methods and Minute (time), and it has been generally named as 5M’s (Bowey, 1982). Cost incurred on these resources in producing a single unit of (final) product is called the direct cost of manufacturing in that organization (Black, 2002). Based on the practical product cost analysis of the manufacturing cost of an automotive (rubber) product, the following inferences are made (Figure 1).

The raw material contributes 50% of the total cost. It can be addressed by concentrating more on consumption and method of processing using the tool of Supply Chain Management (SCM). Among the direct cost, cost related to ‘men’ includes direct labor and the indirect (overhead) expenses. The next important contributing resources are men and labor. Therefore, savings in each individual will lead to introducing /recruiting persons for manufacturing. On the other side, in India, it is not economical to convert all operations as fully automatic. It will again lead to increase in the manufacturing cost of the product (Anantharaman and Nachiappan, 2006). The aim and role of ‘men’ is to add value to the product instead of cost so that the product can be manufactured and delivered in respect to the customer taste and willingness/ desire (Nachiappan and Anantharaman, 2006).

Operations Management Journal, Continuous Line Manufacturing System (CLMS), Men (labor), Material (consumable), Machines (equipment), Methods and Minute (time), Design of a New Reward System, Continuous Line Manufacturing Industry.