The Lincoln Electric Company's Culture

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In 1989, Arthur Sharplin produced a case study, Sharplin (1989), outlining the organizational structure and culture of the Lincoln Electric Company. This report will be focused on analyzing Sharplin’s case study to discern aspects of the Lincoln Electric Company’s culture. First, we will discuss John & James Lincoln and their influence on the development of the culture of the company. We will discuss their Christian influence, and how applying the golden rule of doing to others as you would have them do to you, helped them shape their company. Additionally, we will discuss the company performance appraisal system, the way people communicate in the company, the merit pay plan, the bonus plan, and finally, the management style. After…show more content…
An example from Sharplin’s research is Lincoln’s policy to “at all times price on the basis of cost and at all times keep pressure on our cost…” Clearly, this is giving the customer what they wanted. Another example from Sharplin’s research is the fact that the Lincoln Electric Company hasn’t had a layoff since 1949! Lincoln identified early on that, “The greatest fear of the worker… is lack of income.” By providing job security and great wages, Lincoln was able to give his employees what they wanted. Even stockholders, despite being listed by James as least important, still benefited from James’ strategy because taking care of customers and employees first naturally increased the company’s profitability. Increased profitability is what every stockholder wants. Sharplin found that the Lincoln Electric Company completed performance evaluations twice a year using merit rating scores that would normally range between 80 – 100. Scores were based on ratings in the categories, Quality, Dependability, Ideas & Cooperation, and Output. This gives employees and managers two formal times a year that they can communicate issues and
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