The LINCOLN ELECTRIC COMPANY has an international reputation as a pioneer in arc welding and for its innovative employee profit-sharing program. It was founded by engineer John C. Lincoln in 1895 to manufacture an industrial motor of his own design. Before opening his own shop, Lincoln worked with prominent figures in the growing field of electricity and electric manufacturing in Cleveland. During this time Lincoln developed various motors, dynamos, and motor-generator sets, all of which were useful to the arc welding equipment that became the core of Lincoln Electric’s production.
On 9 June 1906, with 20 employees and $10,000 in capital, he incorporated the Lincoln Electric Co. By 1914 the company had 150 employees. Originally located at Frankfort and Seneca (W. 3rd) St., the firm changed locations as it grew, moving to E. 38th St. and Kelley Ave. in 1908, then in 1923 to Coit Rd. and Kirby Ave., and again in 1951 to a new facility at 22801 St. Clair Ave in EUCLID.
John C. Lincoln remained active in the company as its president until 1928 and as chairman of the board through the following years. However he turned over management of the company to his brother JAMES F. LINCOLN in 1913. Under James Lincoln, the company shifted its focus to standardized, rather than custom designed products and focused on innovation in arc welding. He also instituted an employee advisory board that helped manage relations between workers and management, and a piecework pay scale that enabled workers to earn higher wages based on performance. The advisory board was comprised of elected representatives from each department and met for bi-weekly meetings. It is a practice the company continues to this day. James Lincoln was also influential in developing a worker incentive plan in which the company offered its employees free life insurance and paid vacations; however, the plan's major element was an incentive bonus instituted in 1934. With $4 million in sales that year, the company paid $131,800 in bonuses; in 1981 Lincoln's 2,684 employees shared a record $59 million in bonuses, an average of $22,008 per recipient. Another aspect of the Lincoln plan was the guaranteed-employment program begun in 1958, in which the non-union company guaranteed jobs for its workers while the employees agreed to accept necessary job and schedule changes.
Over time this system has enabled the company to weather a number of economic downturns. During the Great Depression, Lincoln Electric unveiled a new coated electrode (still manufactured as the Fleetweld tP) that ensured the company’s fiscal continuity during the economic downturn. The unique incentive system also allowed the company to stay competitive and stable during the Depression and after World War II.
The success of the company in the United States allowed Lincoln to pursue ventures abroad. International proprietaries and affiliations were opened in the 1930s in Canada, England, and Australia. Though the venture in England was sold in 1947, the ventures in Canada and Australia proved to be prosperous by the end of the 1940s.
After World War II, Lincoln Electric simultaneously promoted arc welding and increased the efficiency of the company by moving production to a larger more efficient new facility in Euclid, Ohio.
Upon James Lincoln’s death in 1965, William Irrgang, who had started at the company on the assembly line, assumed the position of CEO and chairman. Like Lincoln, Irrgang believed in keeping the product line small and simplified.
The company expanded the factory in Euclid in 1968 and opened another in Mentor, Ohio in 1977. Irrgang saw Lincoln Electric through a recession in the early 1980s during which the company guaranteed continuous employment for its workers, though they worked fewer hours and operations were reduced. Operations returned to normal in the mid-1980s and George Willis succeeded Irrgang as CEO and Chairman in 1986.
Willis’ innovation to Lincoln Electric was to ensure another recession would not severely damage the company by expanding globally. The company expanded to 22 plants in 15 countries, which increased sales dramatically. Willis also allowed the company’s research teams to develop new products. Despite these changes, profitability decreased by the beginning of the 1990s. Donald F. Hastings succeeded Willis in 1992.
Hastings took over management of Lincoln Electric at a time of consolidated losses to the company. Hastings restructured the international plants and closed the unprofitable ones, and scaled back the product line, while increasing the size of the workforce.
Anthony Massaro was named President and the chief operating officer in 1996. Massaro restructured the incentive system so that it would function better in an international company.
John M. Stropki succeeded Massaro as CEO and chairman in 2004 and remained in that position until Charles L. Mapes succeeded him in 2012. Currently(2019) the company continues with its innovative employment policy. In 2019 the company had over 10,000 employees globally and generated revenues of over 3 billion dollars.
Updated by Matt Saplak
Koller, Frank. Spark. 2011.
Moley, Raymond. The American Century of John C. Lincoln (1962).