Lincoln Electric Harvard Case Solution & Analysis

Summary

Stropki the CEO of Lincoln electric plans to do another expansion of his company in Asia for which he visited India. The CEO has evaluated India’s market by himself, and he came up with an opinion, although forman investment’s perspective Indian market is full of potential growth opportunities in itself. But he cannot ignore the entry barriers the company would have to go through as a first step for its expansion in India.

Lincoln electric a hundred and nineteen-year-old company which was primarily created for the production of electric motors. After its diversification in the welding construction equipment Lincoln called themselves as the top most leading producer of welding construction equipment’s in the welding industry.

The company was initially privately owned by john C. Lincoln then on its 100th birthday Lincoln electric gone public, and its shares were trading on New York stock exchange successfully. In these hundred years, Lincoln came out of several welding equipment manufacturer and became no one arc Manufacturing Corporation of the world.

            Lincoln does this by moving five steps forward from the market by investing more attention on the research and development and by making timely technological innovations on their product side. These novelties make Lincoln able to sale their product at a bite high price as compared to the market price.

Following a natural phenomenon, a healthy person is considered to contribute more efficiently on work as compared to the person who’s a sort of weak or not healthy or somehow ill from the inside. We could exactly apply the same scenario on the organizational internal health. Technically Lincoln’s Internal is highly dependent on its finances that the company is getting from its high premium products in various part of the world with their huge market share in five continents. Other factors that also contributes to the company’s healthy environment are good human resource management. From the products perspective, it’s a product development and innovation that leads company’s growth and provide a sense of achievement to the workers even from the grass root level.

Lincoln has not only shown creative actions in its manufacturing products, but also built innovative employee retention ways to hold workers loyalty with the company. A person’s Loyalty can only be achieved if his/her intrinsic needs from job are going to be fulfilled. Lincoln does this successfully, as they have employee involvement in the organization through share ownership. This highly appreciate the employees to participate positively in the day-to-day operations and to show their activeness as they own the company by themselves. The company has also awarded its best performer of the year on grounds of merit-based evaluation system. Apart from benefits and incentives Lincoln also has established an employee resources center that cater employee issues closely and tries their level best to resolve them.

Company follows an entrepreneurial culture among workers; hence everyone has to own his/her task assigned and give their best. As they are responsible for the reporting of their work, in this way they are also accountable to find out their mistakes and work on it so that the mistake cannot be repeated again. No doubt by conferring a participative working environment in the organization, Lincoln is contributing positively towards the society through building positive minds and wealthy social citizens.

Talking about the product development part, giving a complete package to a customer was not an easy task for the organization. Lincoln became able to fulfil this task through its continuous market research and their product need analysis. Lincoln came with the idea of providing complete welding material to the customer with high-quality premium products. Company is also providing an efficient working device to its customers that could reduce their time produce the quality product. Moreover, a company is doing product innovation through technological advance by bringing computerized welding equipment.

Lincoln has also done several acquisition in order to make the company’s work flawless and efficient. Lincoln most acquisitions are from overseas where Lincoln wants expansion; the main reason to do acquisition in the host country is to become the part of that country and to know the working culture in that industry.

As far as Lincoln’s marketing strategies concern, so they come up with an idea of providing training to the company’s suppliers and their distributors so that awareness regarding the use of their product increase which eventually will increase its sales.

              Apart from success stories, the company has also gone through from some difficult situations as well in it’s after expansion era i.e. in the late 90’s company found itself in a position where its higher management is unable to build understanding with labor unions and labor laws in the host countries.....................

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The case describes the business strategy of Lincoln Electric and incentives, and he discusses the global choice of strategy, the company faces going forward. Lincoln Electric in deciding whether a strong push in India is the next step in the process of globalization. The company is increasingly successful in China as a result of its aggressive expansion as a joint venture majority-owned and many plants. The company decides how it can apply the lessons of the Chinese experience, and lessons from the experience throughout Asia, Europe and Latin America, in India. First of all, Lincoln Electric's own manufacturing operation in India? If so, Lincoln Electric can enter the Indian market acquisition, joint venture, or build a new plant on its own. If the company were to enter the acquisition, it was unclear what type of assessment is applied to any of the existing Indian company. If the company were to enter into joint ventures, the question: How can Lincoln be able to undertake key business decisions? If companies had to build its own plant, the question was: Will the cost of starting from scratch, more than enough compensated the full control of the company will use the "Hide
by Jordan Siegel Source: HBS Premier Case Collection 24 pages. Publication Date: November 15, 2006. Prod. #: 707445-PDF-ENG

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