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The Reasons for Lincoln Electric to Build a Strategy for Each of Porters Five Competitive Forces

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Given that Lincoln’ s manufacturing operations were based on high quality and low cost due to high volumes produced by the workers, this is highly indicative of Frederick Taylor’ s Scientific Management Principles in practice. In fact, workers were known not to even stop for 10 minute smoking breaks and were supposed to work extra hours during periods of high demand and productivity. On the other hand, Lincoln management supposed that high worker bonuses, guaranteed employment, and promotion from within were sufficient to motivate workers. Granted that lean manufacturing and lesser levels of management, as well as value chain management, were modernistic methods that were being employed at Lincoln, we can still see that the company is insistent on high productivity and low wastage with emphasis on time and cost control.

Some of the workers also have this attitude ingrained in them as a consequence of working here. The company focused on individualistic rewards and achievement but left the workers to sink or swim in new assignments. Those who could adapt and succeed did. Amazingly the turnover has been low. The company’ s formula for success is based on providing what the customer wants at the lowest price possible.

Sometimes they lose orders due to taking too much on at one time and could not make deliveries. The technological innovation, uniform treatment of workers and management, lean management and good and uniform rewards structure based on merit are important to Lincoln, coupled with open door policy and guaranteed employment. This ensures that both internal and external stakeholders are benefitted through high productivity and cost control leading to higher profits, revenues and shareholder value.   It is important that Lincoln be aware of technological advancements in the field and its employees have the skills and know-how needed to match these changes.

Cultural and sociological changes would also have to be considered as the company expands in other continents where differences are bound to exist.

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