Lincoln Electric's Harsn Lessons From International Expansion  

Oleh:

Hastings, Donal F.

Jenis: Article from Bulletin/Magazine - ilmiah internasional
Dalam koleksi: Harvard Business Review bisa di lihat di link (http://web.b.ebscohost.com/ehost/command/detail?sid=f227f0b4-7315-44a4-a7f7-a7cd8cbad80b%40sessionmgr114&vid=12&hid=105&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bth&jid=HBR) vol. 77 no. 3 (1999), page 162-180.
Topik: INTERNATIONAL; bonuses; CEO; compensation; expansion; globalization; international business; international marketing; international operations; labor relations; losses

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Perpustakaan Pusat (Semanggi) Nomor Panggil: HH10.14 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Less than half an hour after Donald Hastings became chairman and CEO of the Lincoln Electric Company in July 1992, he got the shocking news : losses from the company's European operations were so steep that Lincoln was at risk of defaulting on its loans and being unable to pay its employees their year - end bonus. Since the bonus was the foundation of the company's unusually successful manufacturing operations, Hastings knew that failure to pay it could lead to the company's unraveling. How had Lincoln gotten into this predicament ? By a program of rapid foreign expansion. Lincoln was primarily a U. S. company until the mid - 1980 s, but recession at home and competition from abroad led executives to dream that the company could become a global power. Between 1986 and 1991, Lincoln took on unprecedented debt in order to finance foreign acquisitions, mostly in Europe. A number of factors doomed the venture : recession in Europe, unfamiliarity with Europe's labor culture, lack of international expertise at the top. But the root cause, Hastings admits, was overconfidence on the part of Lincoln's leaders in the company's manufacturing abilities and systems. Hastings, now chairman emeritus, recounts how the company suffered through the early 1990s and then returned to prosperity. It wrote off most of its European operations, ramped up domestic production and sales, and hired top managers and board members with international experience. As a result of strenuous efforts at all levels of the company, it managed to keep paying the bonus and to largely regain the trust of its people.

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