The Potential and Limitation of Teamwork Ethics as a Success Factor in the Business World

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The Potential and Limitation of Teamwork Ethics as a Success Factor in the Business World Abderazak Ouassou
Texas A&M University - Commerce

The Potential and Limitation of Teamwork Ethics as a Success Factor in the Business World

Lincoln Electric, one of the most successful companies, is the world leading manufacturer of arc welding products. It is also one of the leading producers of industrial electric motors. This success is mainly driven by the ethical practices of the company. The Lincoln Electric’s main stakeholders are its customers, its employees, and its stockholders, and it has historically valued customer and employee interests over the stockholder one which helped it to be very successful. In other words, the outstanding success is due the importance given to the human factor. That is, the development of a unique internal culture and organizational structure that recognizes people as the company’s most important asset. Moreover, the implementation of an effective incentive management system that contributes to the enhancement of the employee teamwork, collaboration and individual productivity. Finally, developing employee expertise in costs reduction techniques and ensuring high quality practices to provide customers with the best quality products at lower prices, which foster the development of a positive relationship with customers and employees based on trust and fairness.

Lincoln Electric Company has an open-door policy for all top executives, middle managers, and production workers, and regular face-to-face communication is encouraged even with the CEO. However, although managers respect the expertise of production workers and value their contributions to many aspects of the business, the authority of managers is firmly drawn. In other words, employees are encouraged to participate in the decision making process but the worker task assignments and the final decisions are made by the management.

The Lincoln management approach fused to some conjectural situations had threatened the company stability and its ability to sustain its incentive management system. However, it succeeded in overcoming these threats mainly because most of its stockholders were company’s employees. Now, to sustain its success story Lincoln Electric, have no choice but to give stockholders as much importance as the customers and employees, especially after the introduction of a major portion of its stock to public ownership.

The Lincoln system succeeds largely because of an organizational culture based on openness and trust, shared profit, competitiveness, and fairness. The system developed credibility mainly because of the high moral standards of the Lincoln brothers and the ethical and successful story of their company. In addition, Lincoln Electric has a well articulated vision that is passed on through the Advisory Board, made of workers representatives and manager, which resulted in the application of an open line communication policy. The elaboration of such successful system is the result of a long expertise in developing cooperation and teamwork by combining high technology with human talent. To better understand the Lincoln culture and organization lets first see how it evolved over time and how was the Lincoln plan developed.

In 1895 John C. Lincoln, previous worker of the Elliot-Lincoln Company, founded the Lincoln Electric company. Using the $200 he earned from redesigning an engine for Herbert Henry Dow, John opened his new business, with electric motors of his as the main product. During that first few years the company grew but had some setbacks, which include a fire in the first year of operation. In 1907, John’s brother James joined him as a salesman and to help manage the company. On the next years, James introduced many interesting management actions that have greatly contributed to the company’s success. These actions included the constitution of the Advisory Board that meets with the...
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