Scanlon Plan

A system of group incentives on a companywide or plantwide basis that sets up one measure that reflects the results of all efforts. The Scanlon plan originated in the 1930s by Joe Scanlon and MIT. The universal standard is the ratio of labor costs to sales value addedIncreased or improved value, worth, functionality,... by production. If there’s an increase in production sales value with no change in labor costs, productivityA measure of resource utilization efficiency defin... has increased while unit costThe cost associated with a single unit of product.... has decreased.