The Lincoln Electronic Comany

Through Times and Tides of Change

PICTURE TAKEN FROM GOOGLE EARTH

August 13, 2012 Authored by: Muhammad Zulfiqar Sahito

The Lincoln Electronic Comany

1. Ho w w o uld y o u de s cribe Linc olns a pproach t o t he o rganiz ation and mo t ivation o f it s e mployees? Lincolns is a company that has held its standards high for a long time period. A company having a person like John C Lincoln who has numerous patents (in the industry) to his credit was sure to succeed but the factor of younger brother James F Lincoln added to the assurance of success. Lincolns overall strategy is to focus on continuous cost reductions and cost savings due to the business mind of James F Lincoln and transfer to customers because John believed that company's strength was in manufacturing and Lincoln could deliver to customers. The compensation system has been the most important factor in Lincolns performance over the last few years because management believes that through competition and adequate incentives every person could develop to his or her fullest potential. Therefore, it has resulted in high labor productivity and subsequently relative low production cost. Besides the compensation policy, there are other important factors such as top field sales force (having the know-how of engineering), innovative plant and high administrative productivity. Under the current compensation system, employees are handsomely rewarded for their productivity, high quality, cost reduction ideas, and individual contributions to the company. In other word, an employees earnings and promotion are in direct proportion to his individual contribution toward the companys success. 2. W hat f a ctors w ill be c rit ical t o Linc olns c o ntinued s uc cess?
The Lincoln Electronic Comany | 8/13/2012

The most critical factor to Lincolns continued success would be attractive incentive and compensation to the employees to keep their employees enjoying the competitive and motivated working environment. Furthermore, companys philosophy of cost reduction and high quality at affordable price is a factor that should add to the continued success of the company. The management should assure that the company keeps up with the technology and have sufficient profit to pay the suppliers of capital. Then management has to make sure communication can be maintained adequately, which from the current unofficial organization chart doesnt look suitable. Company has an innovative plant design and if they could keep up this sort or certain new innovations it will also guarantee their success.

3. W hat is y o u r 25 y e a r pre diction o f Linc oln Ele ctric ? Lincoln electric is a diverse company. We cannot predict its future as a rigid one; the CEO said The real test of Lincoln would be when the going gets tough however Lincoln Electric Inc. said Friday that Christopher Mapes, its COO (chief operating officer), will become its president and CEO at the end of the year 2012. The company has done wonderful from last 25 years. Company may go for expansion as the CEO also said that population of World is increasing and these people wont tolerate low standard of living thus they expect that demands of construction, cars, generators etc. would increase. Management should go for increasing research facilities as in exhibit nine Mr. Richard S Sabo, the manager of publicity of Lincoln Electronic agrees that they lack in research facility. On the whole, company is on road to success for the next 25 years as well. I could say that because the latest news that went through my eyes are of Lincoln shares that rose 78 cents, or 1.8 percent, to $43.68 in morning trading.

The Lincoln Electronic Comany | 8/13/2012