Organizational Culture And The Lincoln Electric Company

Lincoln Electric Company has a very strong culture based on shared assumptions values and beliefs. This is evidenced by the attitudes of both the company management and employees towards the organization. The unchanged policies, practices and products point towards a very strong corporate culture. High employee performance and productivity over the many years of the company’s existence is also another indicator of a strong culture.

Every organization has values and beliefs that define what they do and how they do things in the organization. These values have significant influence on how the employees behaves and the general performance of the organization – it is these set of values and beliefs, rooted deep in the company’s organizational structure that depict the “dos”, “don’t” and the “hows”, of the organization and these unequivocally represents the culture of the organization. This concept became popular in the 1980s when Peters and Waterman in their book: “In search of Excellence” presented the profound argument that, the success of any organization is inextricable linked to the quality of its culture. (Carpenter, M., Taylor, B., Erdogan, B. 2009 p183). The purpose of this paper is an attempt to analyse the impact diverse cultures played in the success of the Lincoln Electric Company.

Primary features of the Lincoln Electric business model and employment system are displayed through the company’s overall strategy, philosophy, compensations and benefits policy, leadership, and communication within and outside the organization.

The Lincoln Electric Company was a legacy company from which the families ' personal values were incorporated in the beginning and continue to be the fundamental beliefs compromising the company 's culture. By creating and implementing a culture of service, respect, and loyalty, the Lincoln Electric Company has become an institutional leader in American business standards. Lincoln 's culture cannot be summarized by a single dimension of cultural analytics because of its multifaceted culture that is innovative, outcome-oriented, people-oriented, and team-oriented

Though, in reading the Lincoln Electric Company Harvard Case Study by Arthur Sharplin, add up to what I learned from chapter eight this week, I can realize the that the organizational culture is the cornerstone for the growth of any organization. The success of Lincoln Electric Company is due to the environment that is previously established by the Lincoln’s family. If we look at in the introductory of the Harvard case study, Arthur Sharplin states that “The Lincoln incentive management plan has been well known for many years. Many college management texts refer to the Lincoln plan as a model for achieving high worker productivity.” (pp. 1). This is to say that they have already set some policies to make the company what it has always been since its creation.

Before anyone can truly understand and respect Lincoln Electrics’ culture values (which has one of the finest corporate cultures), we must look at how the company has evolved to become what it is today. In the early 1900s, the company transitioned leadership from John Lincoln, the original founder, to his younger brother, James Lincoln. John turned management and leadership to James Lincoln in order to pursue his ingenuity through inventing for the company. One of the first orders as General Manger was to assemble and advisory group that would report to him. He did so by requesting the employees from various departments to elect a representative to be on the committee that would meet with management – to this day the advisory group meets two times per month.

The Lincoln Electric Company 's culture is a wonderful example of how to create an exceptional culture within your business. Lincoln Electric has been a leading manufacturer in welding machines and electrodes for over 100 years. During this impressive tenure, the Lincoln Electric Company has adhered to its founders’ philosophy that the customer always comes first, the employee always comes second, and stockholders come third. This philosophy is upheld throughout the entire organization, from the executive team down to its factory line workers and is evident in their daily business culture. Displayed through a plethora of initiatives; including employee compensations, a concentration on productivity, encouragement of management and supervisors to participate in active leadership and a general appreciation for its employees ' input and feedback; the working culture in this organization is the backbone of the company’s continued achievements. Through the demonstration of their philosophy, Lincoln 's founders and management team have created a culture that has become a timeless model of employee productivity for the world.

In 1895, engineer, inventor, and businessman John C. Lincoln started Lincoln Electric Company. His brother James would join him shortly, in his business endeavor, starting in 1907 (Sharplin, A 1989). James managerial style would most closely be described as people-oriented. He once said “Labor and management are properly not warring camps; they are parts of one organization in which they must and should cooperate fully and happily.” (Sharplin, A 1989) Early on, he created the Advisory Board, a committee made up of both employees who were elected by their peers and upper management, including the chief executive officer. The Advisory Board continues still to this day, meeting bimonthly to discuss employee policies, working conditions, etc. Though these meetings, employees have gained such things as health benefits, life insurance, paid vacation time, retirement pension plans, stock incentives, continued on and off site education, and much more. (Sharplin, A 1989)

In this case analysis I will be analyzing and summarizing my understanding of the organizational culture of the Lincoln Electric Company, based on key pointers and a Harvard Case Study by Arthur Sharplin. In my analysis I will be using the framework from chapter eight of the textbook “Principles of Management” by Carpenter, Bauer and Erdogan to discern aspects of the company’s culture. The company is said to have a distinctive management culture and manufactures welding equipment. It is located near Cleveland, Ohio USA. Lincoln Electric Company is considered to be one of the best managed manufacturing companies in the world.

Lincoln Electric Company was founded in 1895 by John C. Lincoln, who was joined by his brother younger brother James in 1907 (Lincoln Electric, Inc., n.d.). From the very beginning these no-nonsense brothers set about building a company that valued its customers first, prioritized frugality, focused on delivering ever increasing value and lower consumer costs. The company has a borderline fanatical commitment to achieving competitive advantage through an employee incentive system that drives productivity well beyond any norms for the industry, or manufacturers as a whole. To this day, the influence of the founders is clear in the entire structure of the company and its operating philosophies.

Founded in 1865 by John C. Lincoln, the company is known in today’s world for its high worker productivity. The secret behind this extra ordinary success lies in the company’s founding philosophies and established policies over the year. The term ‘Organizational Culture’ was not even in practice when the company established its unique policies like reducing working hours, paid up life insurance, health benefits, social activities, paid vacations, and the pension plans. These measures not only motivated the employees but also helped build trust and partisanship. In Charles G. Herbruck’s words “... these were expressions of mutual respect for each person’s importance for the job to be done.” It can be assumed that Lincoln Electric

The Lincoln Electric Company was founded in 1895 by John C. Lincoln, who then partnered with his younger brother James in 1907. The focus of the company originally was manufacturing electric motors, which then expanded to include battery chargers and in the early 1900’s to portable welding machines. (Lincoln Electric, 2016) The company was founded originally on a construct of Christian values, which may have played a role in creating the dominant culture of the corporation. (Sharplin) This paper presents an evaluative analysis of the business case study presented by Arthur Sharplin, with a focus on determining the overall corporate culture of Lincoln Electric categorically.

In 1906 John C. Lincoln incorporated his business East Cleveland, Ohio forming what we know today as the Lincoln Electric Company. Though the company started out as a relatively small operation, it is now one of the largest producers of welding Machines and electrodes. Branching out from Cleveland, Ohio the company now has more factories in U.S. as well as in other countries. The company’s success has be attributes to several different factors, one of which is the company’s unique culture.

The overall impression, after reading the Case Study, is that Lincoln Electric has a strong culture. In our textbook, Carpenter, Taylor, and Erdogan (2010, p. 197) define a strong culture as “one that is shared by organizational members… a culture in which most employees in the organization share a consensus regarding the values of the company”. This can be considered the foundation of all the successive subcultures that exist within the company, and it starts at the very beginning with the founders. John C. Lincoln started the company on next-to-nothing after he had been let go from his former venture. Despite being started during an economic recession and suffering a fire after barely one year, John Lincoln moved the company to a new location and grew his workforce, which correlated to higher sales and profits. John’s brother, James F. Lincoln, joined the company and took over as General Manager/Vice President while the company was still in its early stages. The first indicator that the company took on a people-oriented culture is with the creation of the “Advisory Board”, which served as a means to advise Lincoln of operations –

Lincoln Electric was founded at the end of the 19-th century by John C. Lincoln. He was a talented engineer who invested 200 dollars in his product electrical motors. Soon he was replaced by his younger brother James F. Lincoln, and the founder of Lincoln Electric dedicated his time to engineering activities and inventions. James F. Lincoln was a different type of inventor. He was a good manager with the nice strategic point of view over manufacturing. At the beginning of the 20th century, the company started manufacturing welding machines which become their iconic product. That is not the only thing Lincoln electric became famous for. The incentive management plan was one of a kind at that time and was the first step of creating company culture with a high focus on the employees, something unheard among the other manufacturers at that time of the century. Both Lincoln brothers were inventors and this was crucial for the earlier company development. Both were pioneers and the vision and the mission that was integrated especially from James Lincoln played a major role in the dramatic company development during the World War II.