Chinese Company: Facts and Analysis on Lincoln Electric

Lincoln Electric
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Introduction
Lincoln Electric is headquartered in Cleveland, Ohio. The company specializes in welding and cutting equipment production, as well as electric motors. It boasts a successful management regime, especially in the United States. Its success centers on its great incentive system. The company is famed for its totally committed employees and its embracement of technology. Its incentive system in Cleveland for example, also called the piece rate payment scheme, which is a bonus system given at the end of the year, which places emphasis on individual performance. This bonus is sometimes as massive as one’s salary in some cases. Many other corporations usually strive to match or better the successes of the company to no avail. This paper looks at the entry of the company into the Chinese market and the dilemma it faces over the same, considering this is a new country with an entirely new culture (Bjorkman & Galunic, 2003).
Summary of the facts
There is a new leadership in place for the company, as Jeffrey Kundrach has replaced Julius Wu as the new General Manager. The prevailing situation is that the company is enjoying quite a tremendous growth in China, with much of what looked like an open, deserted place now filled with offices. The company took the opportunity of introducing automatic technology into the Chinese market, after the local stick companies kept engaging in a fierce fight for popularity and market domination.
Problems
The main problem with the company was the type of management and human resource policies that it would use in China. The company had a good and proud track record in its country of origin, but there still remained a big dilemma as to whether a similar strategy in management as the one used in the United States would be successful in China as well. If it was to apply the same technique, its longstanding dominance in the market would be placed on the line. The other dilemma is that, in case the incentive system is suitable for this Chinese and the bigger Asian market, when and in which way should it be implemented?
Analysis
The introduction of a new General Manager for the company is bound to be a challenge ,since it points to the fact that there lies uncertain times ahead(Redman & Wilkinson,2009) .The incoming manager will inevitably twitch a few things in terms of the company’s operations, and this might have far-reaching effects on the running of the company. The entry into a foreign market is bound to be quite problematic and full of friction due to conflicting cultures which translate to a clash in business and management practices.
The differences are bound to be on literally every facet of the organization’s existence and operations in the country. There will be the differences in the organizational structures first. The company’s hierarchical structure might not be the most suitable for the Chinese market. This is because the Chinese employees observe a cult-like following for the Kai Fu Lee practice, where they want to have a close tie to the company’s national leader (Marchington & Grugulis, 2000).
For example Google Inc. experienced a...