Lincoln Electric – Pay-for-performance in 20s vs. 50s

Question: For this week’s discussion, as an extension of your case analysis, discuss whether this is a management system you would consider working at and why? Consider a pay-for-performance system in your 20’s vs when you are in your 50’s. 

Answer: Well, every management system has pros and cons, and I don’t think there’s one size fits all model. It wouldn’t be right to say this is the ideal management system I’d like to work at, or this is something never works, I’d avoid being part of it. For me, as long as organizational justice (perceptions of fairness in treatment of individuals internal to that organization) is part of the company’s organizational and behavioural culture, I’d consider working at any management system.

Though, for the sake of answering this question in a more concrete way, I’ll say I’d work at Lincoln Electric in my 20’s AND in my 50’s. Lincoln’s pay system is based on individual performance that allows employees to be in charge of their own work, income, and success. In both of my 20’s and 50’s, I’d enjoy being in charge of my individual processes and outcomes. I think this is because I always find seniority-based pay unfair and something that encourages senior-level workers to exploit the system. That’s why I say the name of the system (e.g. pay-for-performance or pay-for-seniority etc.) is not important. For me, I’d pay attention more to whether the company has an established, fair decision-making processes embedded in its organizational culture and management system.