Nucor Corporation is one of the major manufacturers of steel and steel products in the country. It is considered 11th largest company when it comes to the global ranking of the company. Nucor Corporation has faced several different challenges, which forced the Nucor to change its strategies and come up with new strategies. Some of the challenges that Nucor Corporation faced are over capacity. America’s steel industry has more capacity as compared to demands of the market. Unites States’ steel industry is having large capacity to produce the steel and Nucor has to face the same issue.
With the passage of time consumer demand is reducing, because now in the production process people need less steel. Similarly auto sales have been reduced with
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Nucor has its entire stakes in this industry because it has invested huge amount in the business; sustaining this business was very essential for the company. In order to hit back the market Nucor done major changes in its administration method and its strategic planning. For instance, Nucor Corporation left the conservative method of management and enters into market with new force and planning.
Concepts:
Major concepts used in the case study of Nucor are following:
• Horizontal merger:
Nucor has accepted the fact of the pressure they face it is not from domestic player only; it comes from foreign competitors too. Nucor starts focusing on horizontal mergers to reduce its competitors in the industry. Nucor focused on joint ventures and combined with Yamato Kogyo LTD to produce its products in the structural steel industry. It turned out to be Nucor largest division (nucor.com, 2012)
• Positioning:
Positioning means where a brand stands in the eyes of its target audience. Positioning helps the marketers in giving them a proper strategy and makes the target audience view a brand in the same manners. It focuses on priority or aim of the company. In the case of Nucor Corporation, it changes its positioning and came up with new, innovative strategies and products for its potential buyers (Brandeo.com, p. 2).
• Public
More attention to own business than to competitors is their strategy. South magazine observed that Nucor is “stripped down, no nonsense” organization. It keeps maintaining low cost and efficiency, which is the key to making profit in steel industry, by keeping the employee force at the level it should be, empowering them, being totally honest, involving them in decision making process, and using effective incentive compensation system.
There are many competitive forces that are affecting Nucor Corporation. Some of the primary ones are the market size, number of rivals, and pace of technological change.
Nucor has been facing many industry challenges including the overall development of the industry. They are competing with foreign firms on cost and efficiency. Nucor has a low cost strategy because as they say their product is not necessarily very attractive. It does not have attractive or unique selling features other than its cost. The commodity of steel is in a very competitive market. Nucor understands that innovation and productivity are going to be key factors to keep their buyers satisfied with their prices. Nucor is facing many challenges with a growing world market and many of their competitors merging in order to create stronger more dominate
The challenges faced by Nucleon, Inc. present more of an issue with how to take full advantage of an opportunity in front of them, rather than a problem that poses a threat to the company. As a company in its early stages, only putting out its first product, it is critical that it is done in a manner that allows the budding firm to grow. The main issue here is determining the most effective means by which they are to manufacture and market their first product, CRP-1. Doing so requires in-depth evaluation of three strategic options, all with their own benefits and potential risks. The problem statement, therefore, is as follows:
Core competencies, capabilities and capacity: This option would require a high level of changes within the organization. Nucleon’s existing core competencies and capabilities is in the area of R&D. It has no prior experience of production and manufacturing. Manufacturing is significantly different than R&D. It would require Nucleon to acquire different talent, skillsets, experience and very difference focus in developing manufacturing competencies and capabilities.
Upon Review of Nucor Corporation’s current findings, analysis of internal strengths and weaknesses, as well as a comparative analysis at the industrial level of the steel industry, the following includes a summary of findings and recommendations for Nucor Steel Corporation:
Nucor Corporation is the largest steel producer in the United States and had net sales of $12.7 billion in 2005. Nucor is the nation 's largest recycler. In 2004, Nucor recycled approximately 17 million tons of scrap steel, with 5 million of those tons being automobiles. Nucor 's origins are with auto
Another recommendation that I have for Nucor is instead of buying existing plant capacity, make new plants elsewhere or form a joint venture with a supplier to help save money. (Exhibit 3) This would decrease cost of supplies so they would have the extra money to build elsewhere or build a ne plant. By using the SWOT analysis (Exhibit 1) it let me break up Nucor into different parts to see what their strengths and weaknesses are. Nucor is solid with technology and treating the employees correct but the weaknesses that affect Nucor are more market based with some internal problems. Nucor has products for many different industries including automotive and housing. This can cause issues for Nucor if those industries take a fall, which they have over the last 5 years. It’s a good idea to be in these industries but Nucor has to realize what can happen to sales and revenues when one or both of those industries take a fall. Nucor has been expanding more in the United States, recently just building a plant in Louisiana (Exhibit 5). This plant will be a 750 million dollar purchase and will be a mill for pig iron. Nucor is expanding all over the United States but needs more presence internationally plan and simple. Nucor is a solid company with shareholder equity increasing each year; they have a solid stock in the NASDAQ market and continue to be a healthy steel company. They can and will
Nucor Corporation is one of the three largest U.S. steel producers with production capacity of more than 26 million tons and 20,400 employees. The company is also the world's largest steel recycler,
Nucor is a classic case in how a firm can develop sustainable competitive advantages through resources that fit the VRIO criteria. It is worth noting that Nucor has achieved this in an industry that few would describe as attractive.
Over the years Nucor emerged as a market leader in the American steel producing industry due to its sustainable growth strategies and incorporation of sophisticated technologies that enables the company to grow exponential and become a market leader by offering high quality steel products at lower costs. The company backed its growth strategies by massive integration in the American market. However, this growth strategy proved to be predominant in capturing the American market thus ignoring the potential competitive threats that could come from foreign steel producers. This included both steel producers integrating with American minimills and foreign producers who used America as a lucrative export market and dumped their products.
Nucor has created a company that is both internally and externally fit to the environment. The firm responds well to the driving forces of the industry and has opted to take a low-cost strategy with the relentless pursuit of innovation and strong employee productivity in order to combat the issues of the steel industry. In 2000, Nucor decided to expand its operations by acquiring new firms and new factories while continuing with its low-cost operations. The competitive strategy of Nucor has helped it become one of the leading manufacturers of steel and steel products in the United States.
In order to sustain its competitiveness and profitability, Nucor shall consider going global. Generally, the criteria needed for Nucor to go global are intellectual capital, psychological capital and social capital.
Nuplex Industries Limited is a resins and specialty chemicals company based in New Zealand and operates around the globe. Resins and Specialties are two segments the company owns: