Lincoln Electric - Case Study Example

Table of Contents Table of Contents 1 Introduction 2 Contributing Factors at Lincoln Electric 2 Understanding of the Factors Responsible for High Performance 4 Recommendations 5 Conclusion 5 References 6 Introduction The company Lincoln Electric was established in the year 1895 and is the leader in the welding business worldwide. The company has its head office in Cleveland in the city of Ohio. It has associations as well as joint-ventures in around 19 different countries. It also has manufacturing units and distribution systems along with sales offices located in over 160 countries. It has above 8,400 employees in its offices that are spread worldwide. The company attributes its success to the company’s team arrangement that is highly innovative along with the incentive structure. The company had recognized the significance of productivity in regard to team work long before and so, employs a team arrangement since then which has contributed greatly towards the achievement of the company (Lussier, 2008). Contributing Factors at Lincoln Electric One of the major contributing factors towards the success of Lincoln Electric is its flexibility. The company does not believe in maintaining an official organization chart in order to offer high flexibility. The company’s easy and less complicated policy support s employees to go to anyone whom they think to be proficient enough in providing solutions to their problems offering a flexible organizational structure. Flexibility is considered to be an important factor for the success of any organization. Employees or workers should be given enough flexibility to work according to their own ways and convenience in order to be productive ensuring the superiority of the end products (Bhattacharya & Et. Al., 2005). An easy and less complex policy would remove the barriers among the workers and the executives and would facilitate smooth communication. Communication is quite important in organizations so that the problems can be communicated to the concerned person and measures can be immediately taken to find a solution without largely hampering the manufacturing functions (Towers Watson, 2010). The company does not have any special policies or perks for the executives which promotes a sense of equality among the employees and in turn encourages a sense of responsibility in them. The company handed over the control of management to various teams which facilitate them with the right to take decisions when necessary. This ensures a smooth flow of work, as employees need not wait for others to take decisions and then having to act accordingly. This triggers in them a sense of responsibility to perform better (Willcoxson, 2011). Another important factor is that employees are entitled to profit sharing as well as stock options based on individual as well as team performance (McGee & Et. Al., 2006). Employees are influenced to bring forward innovative ideas by the management which would enhance their productivity. The company constantly invests on training as well as educating the employees to make certain effectual contributions towards business performance. The responsibilities given to the employees are also considered as significant factor. They include pay cuts and penalties in case of absenteeism which instill a sense of responsibility, the workers related to production needs to provide assurance regarding the quality of individual piece produced by them or else no payment is made against it and finally there are only few supervisors owing to which team work is promoted without any detailed supervision. Thus, the above mentioned factors can be considered as the major contributing factors for the company’s superior performance (Lussier, 2008). Understanding of the Factors Responsible for High Performance The high performance of Lincoln Electric is reliant on many external as well as internal factors. Flexibility, communication, incentive structure, policies, sense of equality and responsibility are the most important contributing factors accounting for the superior performance of the organization and have been already discussed above. There are certain other factors as well that needs to be discussed further. Among the external factors there are the skills and proficiency possessed by the employees. Adapting to the changing technology is the other external factor that ensures high performance. The other factors include innovation that helps in developing new ideas to enhance the process of production as well as to make it cost-effective which would result in better performance. Freedom given to employees to take decisions also ensures high performance. Working in teams promotes a structured way of working as well as interaction assists in sharing of knowledge which in turn results in efficient performance (Eurofound, 2007). Measuring performance facilitates to induce transparency as well as focus on the process of production that triggers high performance (AMA, 2007). Providing training and education to the employees in order to keep pace with the changing technology assists in updating their skills which in turn improves performance (Lear, 2010). Recommendations Although the important factors needed to achieve higher performance are present in Lincoln Electric but there are still few factors which if implemented would assist in attaining a much higher level of performance. Notably, triggering competitiveness among the teams would help in attaining higher performance. The employees should be in contact with the customers which would assist them in understanding the way their task contribute and the ways by which they can create a productive difference (Shapiro, 1999). This would have a positive impact on the overall performance of the employees and the organization as well to a large extent. Another important factor is to assign leaders to the teams who would guide the team and support them towards the right direction enhancing the team performance (Alexander, 2011). Conclusion From the above discussion, the factors behind the success and superior performance of the organization have been identified such as flexibility, communication, participative management and so on. It is evident from the discussion that the organization successfully incorporates those factors in its system of working which would help them achieve a superior level of performance. The sustained existence of the organization and their superior performance lies behind the successful implementation of the contributing factors. However, there are few other factors that have been recommended so as to raise the degree of their performance more significantly such as competitiveness, leadership and customer contact. References Alexander, J. A., (2011). Creating a High-Performance Culture: Leadership Roles and Responsibilities. Alexander Consulting. AMA, (2007). How to Build a High-Performance Organization. A Global Study of Current Trends and Future Possibilities, 2007-2017, 1-71. Bhattacharya, M. & Et. Al., (2005). The Effects of Flexibility in Employee Skills, Employee Behaviors and Human Resource Practices on Firm Performance. Journal of Management, 31, 1-19. Eurofound, (2007). Teamwork and high performance work organization. European Foundation for the Improvement of Living and Working Conditions, 1-59. Lear, G., (2010). Training’s Role in Achieving High Performance. Resource Development Systems, 1-19. Lussier, R. N., (2008). Management Fundamentals: Concepts, Applications, Skill Development. Stanford, Connecticut: Cengage Learning. McGee, H. M. & Et. Al., (2006). The Effects of Individual and Group Monetary Incentives on High Performance. Performance Improvement Quarterly, 19, 101-124. Shapiro, J., (1999). Building a High Performance Organization. Shapiro & Associates, 1-9. Towers Watson, (2010). Capitalizing on Effective Communication. Communication ROI Study Report, 1-17. Willcoxson, L., (2011). Defining And Creating A High Performance Organization. Australian Journal of Management & Organizational Behavior, 4, 100-106. Read More