Case Study Analysis Lincoln Electric: Venturing Abroad

Subject  > Businesss Research Papers  > Case Studies  > Computer and Electronics Companies

Lincoln Electric (LE) has been a producer of electrical and welding technology products since the late 1800's. The company remained primarily a family and employee held company until 1995, then approximately 40% of its equity went to the public. James Lincoln, one of the founders, developed unique management techniques that effectively motivated the employees. These management techniques were implemented as an unusual (for the era) structure of compensation and benefits called "incentive management". The incentive management system consisted of four key areas: factory jobs based solely on piecework output; a year-end bonus that could equal or exceeded an individual's regular pay; guaranteed employment; and limited benefits. Management successors to James Lincoln continued with this ...

... talents and then to quickly implement them. Lincoln should conduct cultural research into what types of rewards apply to the Indonesian culture and then custom design an incentive system that utilizes these rewards. The successful implementation of this similar formula of corporate culture and incentives will allow Lincoln once again to continuously improve through employee innovations. The custom designed incentive reward may be: benefits on a rising scale; additional vacation/compensation time; or company ownership as a stock option plan instead of the bonus/compensation plan used in the U.S. Lincoln should continue to leverage their brand reputation/loyalty, and leverage their ability to produce at a lower cost (through its successful innovation processes)

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