Lincoln Electronic Case Study

Assignment on: Case Study (Lincoln Electronic)

Course Title: International Business

Course Code: MGT-2133

Section: 07

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Submitted To:

Syeda Khadiza Akter

Lecturer & Coordinator

School of Business Studies

Southeast university, Dhaka,

Bangladesh.

Submitted By:

04th April 2017

Syeda Khadiza Akter

Lecturer

School of Business Studies

Southeast University

Sub: Submission of term papers.        

Dear ma’am,

 We are submitting herewith our term paper on case study of “(Lincoln Electronic)” as your instruction to fulfill our International Business course’s requirement.

The main purpose of this term paper was to study and get the solution of the case and another purpose was to learn and gain knowledge.

We sincerely hope that this report will merit your approval. We are grateful to you for giving us the opportunity to solve this case and let us know about our own ability.

Respectfully Yours,

Habibur Rahman

Table of Contains

Question 1

What is the source of Lincoln long standing competitive advantage in the United State market for the arc welding equipment?

Answer: Competitive advantage of Lincoln electronics’ are Strong Organizational Culture and Incentive Management Scheme.

Strong Organizational Culture:

Founder James Lincoln had strong respect for a person’s ability motivation – Extraordinary performance reward for efforts. Open door policy which removes communication barriers. Advisory board where representatives and executives meet twice in a month.  Treat employees equally eat in the same canteen, no reserve parking places, same size of office. Share gains with consumers by lower price with employees by higher pay and shareholders by higher dividend. Lower cost structure. High level of productivity. Long working hours (43 to 58) per week.  

Incentive Management Scheme: There was no base salary. Employees get paid by the according to the piece of product they produce. There was a bonus from year profit. Bonus merit rating, employee’s level and quality of output, employee’s attitude, dependability boost productivity.

Question 2

Why did Lincoln enter foreign market through Acquisition and Greenfield venture rather than through Exporting?

Answer:

The benefits of Acquisition:

• It means takeover,
• A very quick way to execute,
• Less risky than other ways the company can rapidly build its presence in the targeted foreign market.

In This Case:

• Lincoln acquired 7 manufactures,
• It was easy way to introduce their product to the local market,
• It can also acquire valuable information about the local market,
• Manager’s knowledge about the local market environment.

The benefits of Greenfield investment:

• Parent company starts a whole new and wholly owned operation in foreign country,
• Gives a company greater ability to build the kind of subsidiary company that’s it wants,
• Ability to engage in global strategic coordination,
• Ability to realize location and experience economies.

In this case: