Essay On The Lincoln Electric Company

The Lincoln Electric Company is an extremely successful company that primarily manufactures and sells arc-welding products. In order to understand that success, one must understand Lincoln’s unique organizational culture.
Lincoln is a customer oriented company. They strive for customer satisfaction above everything, including the interest of the stockholders. They are aware that if the company draws customers, stockholders will naturally follow. Lincoln believes in delivering to its customers quality products that are superior to its competitors at a lower price. They manage to accomplish this while maintaining ethical practices and utilizing a variety of strategies that increase the company’s overall productivity.
Lincoln understands that in order to have a productive company, they must have motivated employees, and they have implemented many plans which do just that. Early on, the company reduced workers’ hours, and they are union tolerant. Lincoln’s employees receive medical and life insurance benefits, a bonus plan of up to 25% their
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An advisory board meets with the chairman and president twice each month to fine tune operations, and Lincoln trusts its workers and does not micromanage them. Managers oversee around 100 workers each, so the factory employees operate with very little supervision. Although the managers have authoritarian power, there is an open-door policy which allows workers to reach specialized personnel without running through a chain of command.
One might think that with all the perks received by the employees Lincoln could not possibly be profitable. On the contrary, Lincoln spends less on advertising, research and development than its competitors, yet they supply 30-40% of all the sales for products of their type in a very competitive market, and although the workers are paid more, high productivity means the company pays just 23¢ for each dollar earned in sales (Sharplin,

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