Nucor Case Study

3399 words 14 pages
Case Background
The Industry

Nucor Corporation has been moving in a very challenging industry which has faced various problems in recent years. The steel industry experienced slowed demand for steel which resulted from substitution of alternative materials. Furthermore, it also had to cope up with increased foreign competition and strained labor relations.

But despite all these obstacles, Nucor Corp. still managed to have a five-year sales growth average of 23%, which is 11 percentage points higher than the nearest fast-growing competitor. The company even had a 5-year ROE average growth of 18% which is more than double than the industry average while maintaining a healthy financial condition having 7% debt to capital percentage, the
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Focusing on its ability to pay top wages, Nucor attracted hard-working and dedicated employees that contributed to the company’s increased revenues and further boosts its profitability.

Maximizing what the government has to offer. To complement the competitive workforce of Nucor, management sited its operations in states with beneficial tax structures and regulatory policies that encouraged business growth.

Strategy

Focusing on two major competencies. Nucor’s strategy were built around its two major competencies, first is building steel manufacturing facilities economically, and second is operating them productively. Management is committed to internally-generated growth, so as to build new plants whenever they want to expand its operation and production, rather than enter into merger agreements or acquire existing businesses. Through this, the company was able to keep its company culture intact and unblemished.

Establishing its presence through its company’s hallmarks. With its principle of continuous innovation in developing its product base and production processes, the company is always a prime-mover and is never left behind by competition. In 1998, the company’s variety of steel products is far greater than any player in the industry, offering its customer more options to choose from. Moreover, Nucor utilized modern equipment to run production in a more efficient and effective manner. Concentrating on

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