Nucor Corporation – Case Study and Recommendations on Strategy
Nucor Corporation: Competing against Low Cost Steel imports deals with leading steel manufacturer Nucor Corporation and trends in the steel industry affecting Nucor. Steel manufacturing is an old business, but is currently facing the fast changes associated with new technologies, the rise of globalization, and changes in cost and efficiency. To date, Nucor has maneuvered business cycles and market challenges to maintain a positive profit margin in every quarter since 1966 (Thompson, 2008). The company’s strategy of decentralized structure, focus on disruptive technology, unique employee engagement …show more content…
Again, threats and weaknesses related to costs and price are well mitigated through a strong leadership driving the corporate culture to all levels (Thompson, Strickland, Gamble, 2008).
Recommendations to Address Threats and Weaknesses
In reviewing Nucor’s Key success factors, it is evident that that the threats and weaknesses related to product price and production costs are currently well addressed. Not to imply that Nucor should not manage for continual improvement related to the threats addressed by the key factors, the recommendations presented are directed at those threats and weaknesses not currently addressed.
Development of a Formalized Strategy – Nucor has had the luxury of a charismatic leader to drive corporate culture. As Nucor transfers leadership, the key to smooth transition is to clearly and credibly inculcate the leader’s vision into the firm’s internal structure and governance. Otherwise, best practices may prove to be transient and limited to the leader’s tenure (Thompson, Strickland, Gamble, 2008).
Controlled Inorganic Growth - As seen in Thompson (2008) the United States steel industry is mature with low expected growth. Nucor must look internationally for growth as the Asian market has the highest projected growth rate. So while international growth is required to counter globalization,