Motivational Strategies at Lincoln Electric: Successes and Limitations
Lincoln Electric employs a unique motivational system primarily centered around financial incentives, including bonuses based on individual performance evaluations. This approach has resulted in low employee turnover and a solid profit record over decades. However, while the system thrives in North America and Australia, it encounters challenges in Europe due to differing social security expectations. Understanding these cultural dynamics highlights both the effectiveness and limitations of incentive-driven motivation across various global contexts.
Motivational Strategies at Lincoln Electric: Successes and Limitations
E N D
Presentation Transcript
Question 1 Describe the practices that Lincoln Electric uses to motivateemployees. What are some of the consequences of these practices for employees and the company? The onlymotiovationalsucessis money. Employee’sbonus isbased on his or herevaluation. Employees are motivated by money. The company has a reallylowturn over, and theyhaven’t laid off any one for 40 years. Theypost a high profit eachyear.
Question 2 Discuss the motivational system at Lincoln Electric, usingeach of the needtheories of motivation. Whatdoeseachtheorysay about the motivational practices at Lincoln Electric and whichtheoryworks best for explainingemployees’ motivation? Goal setting theory states that goals are motivational when they are specific and challenging, and when workers are committed to them.
Challenge people with money. Employeeswhowork hard willbe more paidthanothers. SELF ACTUALISATION (Growth, advancement) creativity) niveau V ESTEEM – level IV (Self-esteem, self-respect) ))prestige, status) niveau IV Social link – level III (Love, affection, belongingness) niveau III SAFETY – level II (Safety, security, stability, protection) niveau II PHYSIOLOGICAL – level I (Food, water, sex, sleep ) niveau I A good pay to motivate the physiologicalneed.
Question 3 Consider the motivational system at Lincoln Electric in terms of the processtheories of motivation. Whatdoeseachtheorysay about the company’smotivational practices? In otherwords, canweunderstand the system and itseffectiveness in terms of expectancytheory, equitytheory, and goal setting theory? Specific goal or chalenging goal bringsome motivation to be performant and, at the end, bring satisfaction in your job.
Question 4 Some have saidthat the methods of motivation usedat Lincoln Electric shouldbeused by all organizations to motivatetheiremployees. Do youbelievethis to betrue? Explainyourreasoning. • Some have said that the methods of motivation used at Lincoln Electric should be used by all organizations to motivate their employees. Do you believe this to be true? Explain your reasoning. • We think that the methods of motivation used at Lincoln Electric can be used in certain organizations, but not everywhere. That will depend of the background of the society (seniority) and his capacity to recruit persons who are able to work like that: More work for more money: • This causes much pressure, because they doesn’t have socials helpings, insurance, and they must produce more to be paid more • This method can not be adapted in every company, for example, a company of intellectual services this management. This method is usefull for manufacturing product, because we can account them.
Question 5 Comment on the cross-cultural limitations of Lincoln Electric’smotivational system. How do the theories of work motivation help us to understandwhy the company’sincentive program did not work in Germany but doeswork in NorthAmerica and Australia? Whatdoesthis tell us about the cross-cultural limitations of the theories of motivation?
Comment on the cross-cultural limitations of Lincoln Electric’s motivational system. How do the theories of work motivation help us to understand why the company’s incentive program did not work in Germany but does work in North America and Australia? What does this tell us about the cross-cultural limitations of the theories of motivation? In Europe, the employees have obtained social advantages (like social covert, insurance with their company…) then they do not have in North America and Australia. It is the most important difference between this two systems. In Europe, we have obtained social advantages that’s why we are not really concerned about physiological and safety motivations, in America they haven’t the same advantages, it represents a danger for them because if they lost their jobs or if they are sick, they can lost their house, it immediately touch physiological motivations.
Question 6 Whatcanotherorganizationslearn about motivation from Lincoln Electric? What do yourecommendthatorganizations do to motivateemployeesbased on yourknowledge of the Lincoln Electric motivational system and on yourunderstanding of motivation?
What can other organizations learn about motivation from Lincoln Electric? What do you recommend that organizations do to motivate employees based on your knowledge of the Lincoln Electric motivational system and on your understanding of motivation? The financial aspect on the employees motivation is probably the most important things to keep the motivation at is high level.It depends of the personality of all employees, but it is important to propose a equitable wages remunerations.For us, companies have to proposed to their employees a more adaptable system. When signing a contract of employment, employees have to choose between two kinds of contracts : For the first one, employees can opt for more social advantages and less bonus.For the second one, employees can opt for more bonus and less social advantages.
