Lincoln Electric

Lincoln Proposed Resolution:

1.1 International Expansion Team

• The root of Lincoln Electric’s troubles began with the quick expansionist mindset of George Willis. The main trouble was the speed of the expansion. Lincoln Electric should have formed international expansion team focusing on the key areas that initiates a market analysis to spearhead strategic directions of developing good governance framework and promoting inclusive growth. They are also responsible to evaluate alternative mode of entry into selected regions with the following mode of entries: Joint Venture, Acquisitions, Partnership and Trading.

2.1 Develop culture profile of every country it has operations or going to have a presence. Understanding other people's languages, cultures, government’s laws and business etiquettes is of great value in expanding Lincoln’s market globally.

3.1 Standardized and cap group bonus pay-out base on agreed performance measures and score card. These measures will benefit Lincoln’s to have an effective policy and operational efficiency.

4.1 Be willing to tweak it’s performance measurement system. Lincoln must learn how to adapt in-country conditions, government policies, laws and regulations

5.1 Strategic Planning Functional Team. This proposed team from Head Quarters must be able to identify the broad as well as the detailed issues concerning international transaction.

6.1 Proper Classification of Lincoln’s Market such as Global OEM, Emerging Markets, Global After Markets and Regional Distribution Organizations.

7.1 Adaptation of Business Unit approach. Lincoln’s should categorize the profit centers and expense center’s business units accordingly. Proposed business units are as follows:

Profit Centers:

a. Power Gen BU

b. Marine BU

c. Oil & Gas BU

d. Construction

e. Automotive & Transportations

Expense Centers

a. Global HR

b. Logistics & Operations

c. Global Sourcing

d. Global Production

e. Global R&D Engineering

Lesson Learnt

A major element for any organization to sustain success and to continue growth would be to build and maintain an institutional ability to learn. Because Lincoln had encountered failures in its previous attempt to expand internationally, Lincoln had the unique opportunity to learn lessons from these failures.

1.1 Ethnocentric mindset

Lincoln should implement fundamental shifts in orientation. The impact of internationalization on organizational culture beyond ethnocentric mindsets and towards polycentric and egocentric ones. Prescriptive management and organization literature on fit, consistency, and congruence argue in favor of such shifts.

2.1 Assume incentive system and culture could be transferred worldwide and workforce could be quickly replicated.

Lincoln Electric is an international firm, which adds different dimensions to its challenge of being productive and successful. Some of the tools that are effective in America such as incentive pay and employee advisory boards may have little to no effect in other countries with different cultural values. Americans value money, recognition and success while employees in another nation might