Nucor Steel Case Study

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. The market size is shrinking because of the increase in competing international steel companies. The number of rivals in America is declining due to higher labor costs than in foreign countries. There is a very fast pace of technology in the steel industry and it seems that the company, that obtains the newest technology, flourishes. This is due to the difficulty in lower costs of steel production. Better technology is one of the only ways to decrease costs because labor is pretty much at a set cost and all that is left is the cost of iron and making the steel. If a company can get its hands on a new technology that allows it to under price its competitors then it has a big advantage in the steel industry. Nucor’s main rivals in the steel industry are AK Steel Holding Corporation, Mittal Steel Company, and U. S. Steel. The five forces for the steel industry are the buyers, substitutes, suppliers, threat of new entrants, and rivals. The buyers have a fairly strong power on the steel producers. This is because of the low switching cost between competitors. Unless a contract is signed between a steel company and its buyer, there is little cost to the buyer if it wants to switch to a different steel company. There are not very many substitutes for steel, as steel is a commodity, so the substitute power is weak. Steel is a one of a kind item in that it is very strong and very versatile in its use. It is used in buildings, automobiles, bridges, garage door openers, and many other everyday objects. Suppliers also have a weak power in the steel industry. The suppliers are supplying iron to steel companies. Iron is very common and many companies sell it. Also, steel companies frequently integrate backwards and provide their own iron to their steel mills. The threat of new entrants is very weak due to high entry barriers and the current struggling competitors. The rival power is moderate to strong because there are a fair number of steelmaking companies. Also steel dumping occurs, but I will be talking about that later. According to this analysis, Nucor is in a three star industry, so it seems to have an okay chance at surviving. It is not the best industry to be in, but Nucor still has been able to flourish due to its organizational philosophy and technological innovation. 2) The driving forces behind the steel industry are industry growth rate, globalization, technological change and manufacturing process innovation, exit of major firms, and frequent change in cost. The steel industry is falling. There is a declining demand for steel and many companies have already gone bankrupt or are on the verge of going bankrupt. Some of these companies are Bethlehem Steel and Ling-Temco-Vought. The steel industry is very difficult to compete in because more steel is being produced than there is demand for it. Globalization is also a problem for the steel industry in America. Due to globalization it is getting easier for competing companies to send their products to other countries. This causes a problem for companies like Nucor because America has strict labor laws. In other countries labor is exploited and workers are paid very little, while in America, companies must pay their workers a minimum wage. One good thing that America does do is provide tariffs on incoming steel products to help American companies better compete with the international companies. Some countries are subsidiaries to the steel companies in their countries. This means that the governments have a vested interest in the company and want it to succeed. The companies can then sell products, like steel, at a much lower price due to the incoming funding form the government. China has been accused of this and America has taken action to alert the World Trade Organization to settle the matter, but this is only one step to â€Å"leveling the playing field† with China. The technologies for making steel are constantly changing and this allows for more efficient and therefore cheaper steel products. It seems that the companies, who obtain these technologies, obtain a significant head start in the industry. Like I said before, many companies are going bankrupt and are leaving the exiting the industry. Since steel is a commodity it leads to very volatile prices and can change quite frequently due to demand. By looking at Exhibit 1, you can see how the average price per ton decreased form $425 per ton in 2000 to $354 per ton in 2001. This exhibit shows how many tons of steel Nucor sold during certain years from 1970 to 2006. It is interesting to see that Nucor’s net income was fairly low during the years of 2000-2002, but increased to $1,121. 5 million. This is because of Nucor’s many acquisitions during the low period. Just a few years later in 2004, the price of steel was back up to $595 per ton. These driving forces very easily impact the steel industry’s competitive structure in a bad way. These driving forces make it very difficult for steel companies to compete in this industry. 3)The prospects for future profitability of the U. S. steel makers are very unattractive. Unless America can successfully combat China’s enormously, inexpensive, production ability, I do not see any American steel company surviving. China just has too big of a production ability and has the workforce to do it cheaply. Nucor will have to expand in this industry in the United States to survive. If the WTO negotiations with China go well then American steel companies may have a chance in the steel industry. If they do, then America can increase tariffs on incoming steel products and give American steel companies a chance to survive. Future profitability looks grim for American steel companies because of what I described before. China has been accused of subsidizing its steel companies, therefore funding them to make it possible to â€Å"dump steel† which is the process of selling steel at prices below the cost of making it. China would do this because then it would eventually under price foreign competitors and run them out of business. This, supposedly, happened back in 2000-2001 and devastated the steel industry in America, causing many companies to go bankrupt or be bought by other companies. Nucor was lucky enough to have survived this fall out and acquired many steel plants at low prices. The steel industry did bounce back in 2005-2006 and this allowed Nucor to grow quite rapidly due to its previous acquisitions. If America can again survive the big Chinese power, then Nucor will succeed, but right now it looks bleak for the American steel industry. 4)Nucor has adopted a low-cost strategy based on four parts. These parts are acquisitions, technological innovation, plant innovation, and joint ventures. The acquisition part of the Nucor strategy is that it has acquired many different steel companies in 2000-2001, when the steel industry in America was suffering. Because of the low time in the steel industry, Nucor could purchase steel companies at lower prices than normal. This helped its low-cost strategy substantially because it allowed Nucor to grow yet still remain a low-cost steel producer. Exhibit 2 shows Nucor’s financials, and very accurately illustrates the hit Nucor took during the low period of 2000-2003. This was a perfect time for Nucor to buy other steel companies, as this was one of the only ways for it to grow. Nucor invested heavily in new technologies. Investing in new technologies is very important for steel companies to do, as it is very easy to reduce costs if the company has a foothold on a new technology. Nucor focused on the introduction of disruptive technologies to give it an advantage in the market as compared to its competitors in terms of product quality, cost per ton, and market share. One example of this is the Castrip process. This new process produced flat-rolled, carbon, and stainless steels in very thin gauges. It allowed Nucor to produce steel in fewer steps, and helped produce savings in its operating expenses, therefore increasing Nucor’s net income. The Castrip process needed lower-quality scrap steel, which decreased costs of the scrap steel, and required 90% less energy. Also this new process cut green house gases by 80%. Nucor also increased its capital investments on the newest machinery to provide more efficient steel plants. By providing its workforce with the best possible technology, Nucor was able to max out production yet still retain a safe working environment. The implementation of hard working plant managers, produced hardworking managers that are aggressive enough to implement methods to improve product quality while keeping costs low. Nucor’s last strategic part was its joint ventures. By investing in joint ventures, Nucor was able to grow internationally with out the full capital risk. Some examples of this were its joint ventures in Brazil, Australia, and Trinidad. The joint venture in Brazil was between Companhia Vale do Rio Doce and Nucor. The goal was to produce an environmentally friendly pig iron plant that used eucalyptus trees as fuel. The use of eucalyptus trees as fuel removed 2,400 pounds of carbon dioxide from the atmosphere for every one ton of pig iron produced. Another joint venture was three other companies in Australia. This plant used a new technology process called HIsmelt. This new process converted iron ore to pig iron at a lower cost and higher quality than previously known pig iron producing technologies. The Trinidad plant was acquired in 2007 and was originally in Louisiana. The plant was moved to Trinidad because of the constant supply of natural gas as fuel therefore lowering costs. This plant reduced scrap metal dependence by as much as 25%. It also allowed for a higher quality production of sheet steel. Nucor’s four-part strategy has lead to a competitive sustainable advantage as seen in exhibit 2 between the years of 2004-2006 when its net income soared to more than $1,757. 7 million. Nucor used a cost-based advantage to achieve its competitive sustainable advantage. )Nucor employed an organization philosophy consisting of decentralization, individually operated plants, a three layer structure, good compensation practices for its employees, and good employee relations. Nucor’s decentralized structure allowed for its employees to make quick decisions that did not have to go through all of the bureaucratic steps like that in a centralized company. A decentralized co mpany relied on higher quality employees that could analyze a situation and react quickly and successfully. The individually operated plants were akin to the decentralized company. Each plant was individually responsible for its profits. The three layers consisted of the executives at the headquarters located in South Carolina, the general managers that ran the plants and talked to the executives, and the hourly employees that did most of the labor at the plants. The general managers ran the plants individually form each other and were expected to reach, at least, a 25% return on its total assets. If a general manager failed this, the executives would interfere and had no hesitation in replacing an unsuccessful general manager. The individual plants allowed for team like competitions between plants to see who could be the best performer. Nucor was nonunion, but provided salaries based on competing plants’ salaries in the area. Nucor offered a generous compensation bonus to good work that differed for each worker. Hourly workers received bonuses if they produced more than the standard number of tons. Department managers earned annual bonuses depending on percentage of net income to dollars of assets. Nucor also had great employee relations. Nucor offered 401k plans by matching up to 25% of employees’ contributions. Medical and dental plans were very common for Nucor employees. There was also a tuition reimbursement of up to $2,750 for any employee. For the children of employees, Nucor would provide a scholarship up to $2,750, which would encourage employees to stay until their went to college. As seen here, Nucor treated its employees very well to reduce employee turnover and attract the best employees. Nucor required a high human capital if it were going to use a decentralized structure. The high quality employees that Nucor attracted helped Nucor execute its low-cost strategy, and led to superior results. )Nucor’s leadership, great strategy, and execution were what led to why Nucor was so successful in the steel industry. The great leader that Nucor relied upon was Kenneth Iverson, who changed Nucor from a nuclear energy company into a steel company. As seen in the last question, the decentralized structure helped Nucor react t problems quickly due to the ability of employees to take t he authority to solving problems. To be a great company, you need all three. This was evident in the case of Nucor because it was turned around and became a very successful company in a very different and difficult industry than where it started. )The SWOT analysis of Nucor is as follows. The strengths of Nucor are its strong market position, historically based position, increased production capacity, and strong technological focus. Nucor had a strong market position that allowed it to flourish in the steel industry. The strong market position is shown by its ability to stay out of the red during hard times. This is seen in exhibit 1. Nucor continued to have a positive net income, even during the low period between 2000 and 2002, as seen in exhibit 1. Nucor’s historically based position has given it a long-standing presence that is known to most steel consumers. This has helped Nucor because it tells the consumers that Nucor has been able to provide quality steel year after year. As seen in exhibit 1, Nucor has increasingly produced steel starting at 207,000 tons in 1970 to 22,118,000 tons in 2006. This growth is enormous and not once did Nucor’s steel sales fall below its previous year. Nucor’s strong technological focus has allowed it to become a power in the steel industry. It used electric arc furnaces when they were a new technology and encouraged further innovation into the steel production methods. Some weaknesses of Nucor are that it is mainly located in America and that the steel industry is already very developed. The fact that Nucor is mainly in America limits its growth. Nucor cannot compete with international companies so it is best to stay in America, but that continues to limit its growth because Nucor can only sell so much steel in the United States. The steel industry is very developed due to the early demand for the high amounts of steel back when the steel industry started. Now demand has lessened and the developed companies are fighting to stay alive. Nucor’s opportunities are joint ventures and new technologies. Nucor has taken advantage of some of its joint ventures in Brazil and Australia. This is good because is allows for an expanded production line and further integration backwards. New technologies are a good way for Nucor to grow as it can decrease its costs and therefore increase its net income. This is a necessity for Nucor due to its â€Å"prison-like† existence in America. The threats on Nucor are foreign competitors and decreasing demand. Foreign competitors are growing in the developing nations like India and China. These nations are very large and China already produces one third of the steel in the world. Decreasing is also a problem, which is caused by the increasing amount of suppliers. Nucor’s distinct competencies are its highly successful strategy and high quality human, technology, and leadership capital. 8)My assessment of Nucor’s stock is that it has done the best out of its American competitors as shown in exhibit 3. Exhibit 3 is a comparison of the stocks of Mittal Steel (MT), U. S. Steel (X), AK Holding Steel Company (AKS), and of course Nucor Corporation (NUE). As shown, exhibit 3 shows these four stocks from 1999 to 2009. Mittal Steel did surpass Nucor during the years of 2007 and 2008, but currently Nucor is the highest. This is good because it shows the reaction to the recession, and it shows that Nucor bounced back the best. I personally would not purchase any steel stock because I believe that the growing steel industries in China and India will over power the American steel companies. However, if I had to invest in a steel company, it would in fact be Nucor. 9)Nucor needs to address the growing steel industry in Asia. Daniel DiMicco needs to do something to ensure that Nucor survives. I would recommend further investment in new steel technologies, and if it comes to it, Nucor may have to change industries again, like it did back in 1970. DiMicco may want to make sure that he is not â€Å"keeping all of Nucor’s eggs in one basket† by staying in the steel industry. Moving into the energy industry may be a smart move as there is a definite need for alternative energy. Nucor’s current, increasing net income could help invest in alternative energies that would help Nucor become sustainable. 10)The biggest recent event is the possibility of China potentially steel dumping, which would under price Nucor substantially. This would lead to the downfall of Nucor. Another current event is the new technology of producing â€Å"Green Steel† (http://news. n. msn. com/business/article. aspx? cp-documentid=1090378). This is a new technology that takes waste plastic and converts it into steel. Since plastic is mainly carbon, it is possible to produce steel from the waste plastic. This would solve the problem of what to do with the plastic that is no longer used and help produce cheap steel that also lowers emissions. Lower temperature is needed in this new process therefore reducing the energy needed. This new technology converts waste into very much needed, and useful steel. Nucor Steel Case Study 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. The market size is shrinking because of the increase in competing international steel companies. The number of rivals in America is declining due to higher labor costs than in foreign countries. There is a very fast pace of technology in the steel industry and it seems that the company, that obtains the newest technology, flourishes. This is due to the difficulty in lower costs of steel production. Better technology is one of the only ways to decrease costs because labor is pretty much at a set cost and all that is left is the cost of iron and making the steel. If a company can get its hands on a new technology that allows it to under price its competitors then it has a big advantage in the steel industry. Nucor’s main rivals in the steel industry are AK Steel Holding Corporation, Mittal Steel Company, and U. S. Steel. The five forces for the steel industry are the buyers, substitutes, suppliers, threat of new entrants, and rivals. The buyers have a fairly strong power on the steel producers. This is because of the low switching cost between competitors. Unless a contract is signed between a steel company and its buyer, there is little cost to the buyer if it wants to switch to a different steel company. There are not very many substitutes for steel, as steel is a commodity, so the substitute power is weak. Steel is a one of a kind item in that it is very strong and very versatile in its use. It is used in buildings, automobiles, bridges, garage door openers, and many other everyday objects. Suppliers also have a weak power in the steel industry. The suppliers are supplying iron to steel companies. Iron is very common and many companies sell it. Also, steel companies frequently integrate backwards and provide their own iron to their steel mills. The threat of new entrants is very weak due to high entry barriers and the current struggling competitors. The rival power is moderate to strong because there are a fair number of steelmaking companies. Also steel dumping occurs, but I will be talking about that later. According to this analysis, Nucor is in a three star industry, so it seems to have an okay chance at surviving. It is not the best industry to be in, but Nucor still has been able to flourish due to its organizational philosophy and technological innovation. 2) The driving forces behind the steel industry are industry growth rate, globalization, technological change and manufacturing process innovation, exit of major firms, and frequent change in cost. The steel industry is falling. There is a declining demand for steel and many companies have already gone bankrupt or are on the verge of going bankrupt. Some of these companies are Bethlehem Steel and Ling-Temco-Vought. The steel industry is very difficult to compete in because more steel is being produced than there is demand for it. Globalization is also a problem for the steel industry in America. Due to globalization it is getting easier for competing companies to send their products to other countries. This causes a problem for companies like Nucor because America has strict labor laws. In other countries labor is exploited and workers are paid very little, while in America, companies must pay their workers a minimum wage. One good thing that America does do is provide tariffs on incoming steel products to help American companies better compete with the international companies. Some countries are subsidiaries to the steel companies in their countries. This means that the governments have a vested interest in the company and want it to succeed. The companies can then sell products, like steel, at a much lower price due to the incoming funding form the government. China has been accused of this and America has taken action to alert the World Trade Organization to settle the matter, but this is only one step to â€Å"leveling the playing field† with China. The technologies for making steel are constantly changing and this allows for more efficient and therefore cheaper steel products. It seems that the companies, who obtain these technologies, obtain a significant head start in the industry. Like I said before, many companies are going bankrupt and are leaving the exiting the industry. Since steel is a commodity it leads to very volatile prices and can change quite frequently due to demand. By looking at Exhibit 1, you can see how the average price per ton decreased form $425 per ton in 2000 to $354 per ton in 2001. This exhibit shows how many tons of steel Nucor sold during certain years from 1970 to 2006. It is interesting to see that Nucor’s net income was fairly low during the years of 2000-2002, but increased to $1,121. 5 million. This is because of Nucor’s many acquisitions during the low period. Just a few years later in 2004, the price of steel was back up to $595 per ton. These driving forces very easily impact the steel industry’s competitive structure in a bad way. These driving forces make it very difficult for steel companies to compete in this industry. 3)The prospects for future profitability of the U. S. steel makers are very unattractive. Unless America can successfully combat China’s enormously, inexpensive, production ability, I do not see any American steel company surviving. China just has too big of a production ability and has the workforce to do it cheaply. Nucor will have to expand in this industry in the United States to survive. If the WTO negotiations with China go well then American steel companies may have a chance in the steel industry. If they do, then America can increase tariffs on incoming steel products and give American steel companies a chance to survive. Future profitability looks grim for American steel companies because of what I described before. China has been accused of subsidizing its steel companies, therefore funding them to make it possible to â€Å"dump steel† which is the process of selling steel at prices below the cost of making it. China would do this because then it would eventually under price foreign competitors and run them out of business. This, supposedly, happened back in 2000-2001 and devastated the steel industry in America, causing many companies to go bankrupt or be bought by other companies. Nucor was lucky enough to have survived this fall out and acquired many steel plants at low prices. The steel industry did bounce back in 2005-2006 and this allowed Nucor to grow quite rapidly due to its previous acquisitions. If America can again survive the big Chinese power, then Nucor will succeed, but right now it looks bleak for the American steel industry. 4)Nucor has adopted a low-cost strategy based on four parts. These parts are acquisitions, technological innovation, plant innovation, and joint ventures. The acquisition part of the Nucor strategy is that it has acquired many different steel companies in 2000-2001, when the steel industry in America was suffering. Because of the low time in the steel industry, Nucor could purchase steel companies at lower prices than normal. This helped its low-cost strategy substantially because it allowed Nucor to grow yet still remain a low-cost steel producer. Exhibit 2 shows Nucor’s financials, and very accurately illustrates the hit Nucor took during the low period of 2000-2003. This was a perfect time for Nucor to buy other steel companies, as this was one of the only ways for it to grow. Nucor invested heavily in new technologies. Investing in new technologies is very important for steel companies to do, as it is very easy to reduce costs if the company has a foothold on a new technology. Nucor focused on the introduction of disruptive technologies to give it an advantage in the market as compared to its competitors in terms of product quality, cost per ton, and market share. One example of this is the Castrip process. This new process produced flat-rolled, carbon, and stainless steels in very thin gauges. It allowed Nucor to produce steel in fewer steps, and helped produce savings in its operating expenses, therefore increasing Nucor’s net income. The Castrip process needed lower-quality scrap steel, which decreased costs of the scrap steel, and required 90% less energy. Also this new process cut green house gases by 80%. Nucor also increased its capital investments on the newest machinery to provide more efficient steel plants. By providing its workforce with the best possible technology, Nucor was able to max out production yet still retain a safe working environment. The implementation of hard working plant managers, produced hardworking managers that are aggressive enough to implement methods to improve product quality while keeping costs low. Nucor’s last strategic part was its joint ventures. By investing in joint ventures, Nucor was able to grow internationally with out the full capital risk. Some examples of this were its joint ventures in Brazil, Australia, and Trinidad. The joint venture in Brazil was between Companhia Vale do Rio Doce and Nucor. The goal was to produce an environmentally friendly pig iron plant that used eucalyptus trees as fuel. The use of eucalyptus trees as fuel removed 2,400 pounds of carbon dioxide from the atmosphere for every one ton of pig iron produced. Another joint venture was three other companies in Australia. This plant used a new technology process called HIsmelt. This new process converted iron ore to pig iron at a lower cost and higher quality than previously known pig iron producing technologies. The Trinidad plant was acquired in 2007 and was originally in Louisiana. The plant was moved to Trinidad because of the constant supply of natural gas as fuel therefore lowering costs. This plant reduced scrap metal dependence by as much as 25%. It also allowed for a higher quality production of sheet steel. Nucor’s four-part strategy has lead to a competitive sustainable advantage as seen in exhibit 2 between the years of 2004-2006 when its net income soared to more than $1,757. 7 million. Nucor used a cost-based advantage to achieve its competitive sustainable advantage. )Nucor employed an organization philosophy consisting of decentralization, individually operated plants, a three layer structure, good compensation practices for its employees, and good employee relations. Nucor’s decentralized structure allowed for its employees to make quick decisions that did not have to go through all of the bureaucratic steps like that in a centralized company. A decentralized co mpany relied on higher quality employees that could analyze a situation and react quickly and successfully. The individually operated plants were akin to the decentralized company. Each plant was individually responsible for its profits. The three layers consisted of the executives at the headquarters located in South Carolina, the general managers that ran the plants and talked to the executives, and the hourly employees that did most of the labor at the plants. The general managers ran the plants individually form each other and were expected to reach, at least, a 25% return on its total assets. If a general manager failed this, the executives would interfere and had no hesitation in replacing an unsuccessful general manager. The individual plants allowed for team like competitions between plants to see who could be the best performer. Nucor was nonunion, but provided salaries based on competing plants’ salaries in the area. Nucor offered a generous compensation bonus to good work that differed for each worker. Hourly workers received bonuses if they produced more than the standard number of tons. Department managers earned annual bonuses depending on percentage of net income to dollars of assets. Nucor also had great employee relations. Nucor offered 401k plans by matching up to 25% of employees’ contributions. Medical and dental plans were very common for Nucor employees. There was also a tuition reimbursement of up to $2,750 for any employee. For the children of employees, Nucor would provide a scholarship up to $2,750, which would encourage employees to stay until their went to college. As seen here, Nucor treated its employees very well to reduce employee turnover and attract the best employees. Nucor required a high human capital if it were going to use a decentralized structure. The high quality employees that Nucor attracted helped Nucor execute its low-cost strategy, and led to superior results. )Nucor’s leadership, great strategy, and execution were what led to why Nucor was so successful in the steel industry. The great leader that Nucor relied upon was Kenneth Iverson, who changed Nucor from a nuclear energy company into a steel company. As seen in the last question, the decentralized structure helped Nucor react t problems quickly due to the ability of employees to take t he authority to solving problems. To be a great company, you need all three. This was evident in the case of Nucor because it was turned around and became a very successful company in a very different and difficult industry than where it started. )The SWOT analysis of Nucor is as follows. The strengths of Nucor are its strong market position, historically based position, increased production capacity, and strong technological focus. Nucor had a strong market position that allowed it to flourish in the steel industry. The strong market position is shown by its ability to stay out of the red during hard times. This is seen in exhibit 1. Nucor continued to have a positive net income, even during the low period between 2000 and 2002, as seen in exhibit 1. Nucor’s historically based position has given it a long-standing presence that is known to most steel consumers. This has helped Nucor because it tells the consumers that Nucor has been able to provide quality steel year after year. As seen in exhibit 1, Nucor has increasingly produced steel starting at 207,000 tons in 1970 to 22,118,000 tons in 2006. This growth is enormous and not once did Nucor’s steel sales fall below its previous year. Nucor’s strong technological focus has allowed it to become a power in the steel industry. It used electric arc furnaces when they were a new technology and encouraged further innovation into the steel production methods. Some weaknesses of Nucor are that it is mainly located in America and that the steel industry is already very developed. The fact that Nucor is mainly in America limits its growth. Nucor cannot compete with international companies so it is best to stay in America, but that continues to limit its growth because Nucor can only sell so much steel in the United States. The steel industry is very developed due to the early demand for the high amounts of steel back when the steel industry started. Now demand has lessened and the developed companies are fighting to stay alive. Nucor’s opportunities are joint ventures and new technologies. Nucor has taken advantage of some of its joint ventures in Brazil and Australia. This is good because is allows for an expanded production line and further integration backwards. New technologies are a good way for Nucor to grow as it can decrease its costs and therefore increase its net income. This is a necessity for Nucor due to its â€Å"prison-like† existence in America. The threats on Nucor are foreign competitors and decreasing demand. Foreign competitors are growing in the developing nations like India and China. These nations are very large and China already produces one third of the steel in the world. Decreasing is also a problem, which is caused by the increasing amount of suppliers. Nucor’s distinct competencies are its highly successful strategy and high quality human, technology, and leadership capital. 8)My assessment of Nucor’s stock is that it has done the best out of its American competitors as shown in exhibit 3. Exhibit 3 is a comparison of the stocks of Mittal Steel (MT), U. S. Steel (X), AK Holding Steel Company (AKS), and of course Nucor Corporation (NUE). As shown, exhibit 3 shows these four stocks from 1999 to 2009. Mittal Steel did surpass Nucor during the years of 2007 and 2008, but currently Nucor is the highest. This is good because it shows the reaction to the recession, and it shows that Nucor bounced back the best. I personally would not purchase any steel stock because I believe that the growing steel industries in China and India will over power the American steel companies. However, if I had to invest in a steel company, it would in fact be Nucor. 9)Nucor needs to address the growing steel industry in Asia. Daniel DiMicco needs to do something to ensure that Nucor survives. I would recommend further investment in new steel technologies, and if it comes to it, Nucor may have to change industries again, like it did back in 1970. DiMicco may want to make sure that he is not â€Å"keeping all of Nucor’s eggs in one basket† by staying in the steel industry. Moving into the energy industry may be a smart move as there is a definite need for alternative energy. Nucor’s current, increasing net income could help invest in alternative energies that would help Nucor become sustainable. 10)The biggest recent event is the possibility of China potentially steel dumping, which would under price Nucor substantially. This would lead to the downfall of Nucor. Another current event is the new technology of producing â€Å"Green Steel† (http://news. n. msn. com/business/article. aspx? cp-documentid=1090378). This is a new technology that takes waste plastic and converts it into steel. Since plastic is mainly carbon, it is possible to produce steel from the waste plastic. This would solve the problem of what to do with the plastic that is no longer used and help produce cheap steel that also lowers emissions. Lower temperature is needed in this new process therefore reducing the energy needed. This new technology converts waste into very much needed, and useful steel.

Relations Between Teenagers And Adults Essay

A common phrase that adults can testify to hearing from any given teenager is, â€Å"You don’t understand!† This proves a struggle between the youth and the adults that quite possibly is never-ending. Adults make assumptions about kids, based on the way they dress, which pushes kids further and further away. In the essay, â€Å"Goths in Tomorrowland† by Thomas Hine (2001), he emphasizes the beliefs that adults began the idea of youth alienation from older societies and the teenagers keep it that way. Donna Gaine’s (2001) essay, â€Å"Teenage Wasteland,† discusses four teenagers who were mocked and misunderstood by adults and reporters alike. Jon Katz (2001) lets the kids explain themselves about their seclusion from society and the misconceptions about them in his column, â€Å"More from the Hellmouth: Kids Tell About Rage.† The fear that elders show towards young people is merely a fear of the unknown. Adults are worried about the younger ge nerations because of their misunderstandings of the youth culture, their failure to accept youth into the adult society, and the instigation provoked from young people. Misunderstanding of youth creates the gap between adults and teenagers. Many teenagers spend their whole teen experience searching for someone to just understand them. A lot of them do not even make it through this experience because they give up feeling that no one knows what they are going through. Parents also fear for their kids because they do not understand them. A boy named Evan best explains this in â€Å"More from the Hellmouth: Kids Tell About Rage.† He says, â€Å"People fear what they don’t understand, and let’s face it, the world . . . isn’t something most people can understand . . .† (Katz, 2001, p.81). I can remember going through hard times of changing schools so frequently and my parents thinking it was so easy for me. When in reality, it was the hardest thing to do. It is hard on a kid to have to make friends, move, and then start all over again. When I tried to talk to them about it, they could never see where I was coming from or my point of view on anything. There is nothing that can be done for adults to be able to fully understand the younger generation. It is just a gap that is placed there by human nature and this generation gap can never be fully understood. Regarding my experience mentioned earlier, I noticed that my parents made no effort to understand what I was feeling and how their decisions would affect  me. That is what separated me from them, the fear of the unknown. The fact that the majority of adults make no effort to accept young people into their world is no alien idea. The teenagers from â€Å"Goths in Tomorrowland† were not accepted by adults simply for the reason that the teens dressed differently from what was considered to be normal dress. â€Å"They [adults] confuse thrashers with metalheads and goths because they all wear black. Then they assume that they’re all taking drugs and worshipping Satan† (Hine, 2001, p.71). Adults do not understand that teenagers are constantly searching to define themselves as individuals. Expression through clothing is a form of that. Yet, Hine’s article is not about merely how the teenagers dressed differently to express themselves, â€Å"It is about the ali enation of teenagers from adult society, and equally about the alienation of that society from its teenagers. The mere presence of teenagers threatens us [adults]† (p. 69). Is it the idea that this young generation of gothic-dressed supposed losers will be replacing the elders when their time is up that is so scary? Or are the youth of today causing this boundary that is formed by instigating the adults with things that they know scare them? The fault of the misunderstanding between youth and elders is not all due to the close-mindedness of adults. Young people draw adults to see them as irresponsible and immature by the way they act and carry themselves. It is almost as if they are purposely trying to show the world that they are independent, young, and can do whatever they please. The body alterations that young people use to assert that they are no longer children successfully frighten grown-ups, but they also convince them these weird creatures are well short of being adults. The ring through the lip or the nipple merely seems to demonstrate that they are not ready for adult responsibility. What they provoke is not respect but restrictions. (Hine, 2 001, p. 71) By showing off their ability to create their own identity, they are causing trouble for themselves. They should be able to express themselves freely, but instead they are left with no choice but to keep in and guard their emotions. Yet, by guarding their emotions by putting on these facades, they are â€Å"actively guarding their psychic space because the adults controlled everything else† (Gaines, 2001, p.66). Another thing that sometimes can separate youth from their adults is their inability to speak up. They are afraid that if they say what is on their mind or how they  are feeling that it could be used against them. According to Donna Gaines’ â€Å"Teenage Wasteland,† â€Å"Like any other alienated youth . . ., they don’t like to talk to adults† (p. 65). By talking to adults, they are giving themselves away and â€Å"whatever you [they] say can be held against you [them]† (p. 65). Their deepest and darkest secrets should only be shared with someone who understands them. This game of misunderstanding played between adults and youth has been going on since the beginning of time. They are considered to be in two different societies and it will be like that until the end of time. Adults do not completely understand teenagers and they never will. It is just the truth of being either an adult or a teenager. No one can understand both. Adults refuse to accept youth inside of their world and youth refuse to be a part of their elder’s world. It is a vicious cycle. Adults have to learn to let teenagers live their lives; even when they feel like protecting their children. References Gaines, Donna. (2001). Teenage Wasteland. In D. George & J. Trimbur (Ed.) Reading Culture. 4th ed. (pp. 63-66). New York: Longman. Hine, Thomas. (2001). Goths in Tomorrowland. In D. George & J. Trimbur (Ed.) Reading Culture. 4th ed. (pp. 68-73). New York: Longman.. Katz, Jon. (2001). More from the Hellmouth: Kids Tell About Rage. In D. George & J. Trimbur (Ed.) Reading Culture. 4th ed. (pp 78-83). New York: Longman.

Case Study L’Oreal

Marketing Plan and Control Case study analysis- L’Oreal Nederland B. V. Group Names: Summary General L’Oreal is the largest cosmetic manufacturer in the world since 1992 and contributes sales to more than 100 countries. L’Oreal invested heavily in research and development with the faith: innovation was the critical success factor. L’Oreal was at a stage of making critical decision to introduce Synergie skin care line and Belle Couleur permanent hair colorants which were successfully marketed in France, to Nederland market. These two products were under the family brand name, Laboratories Garnie, the largest provision of L’Oreal. Their introductions to the market were under pressure as Garnie was not very well known in Nederland. The failure of market these products will cause potential problems for future Garnie product introductions. To be market successfully in Nederland, the products have to offer unique, desire, and identifiable differential advantages to Dutch consumers. Dutch Market Dutch is a small but very potential market. With 15 millions of small population, there were significant increases of women working outside the home, delaying of childbirth and rising of income. As a result, women in Nederland had more disposable income and more of them using it to buy cosmetic for use on a daily basis. In European Union, the Nederland ranked fourth in per capita income, however, only 6th in per capita was spent on cosmetics and toiletries. The main customers were those under 25 years old. However, the fastest-growing population segments were the 25 or older groups. Synergie Synergie product line is a facial skin care’s products made with natural ingredients. Synergie product positioned as reliably providing natural colors with the advertising line â€Å"Natural Colours, covers all gray†. L’Oreal goal for developing new products was to introduce only product that had differential advantage with evidence of consumer acceptance. It did not want to gain distribution with excessive reliance on trade deals or high than normal retail gross margins. L’Oreal was perceived as offering high-quality, innovative products, supportive with good in-store merchandising. Bella Couleur Bella Couleur is a line of permanent hair colouring products. The three quarters of Dutch Woman coloured their hair by using permanent colorant. For Dutch women, colouring has become more a fashion statement then just to cover gray. As there were more and more women working outside home, home colouring would increase since it is more convenient. Problems of entering Nederland Market: 1. Competition of medium price products: Dutch woman shopped for values of products. Synergie products are expensive and they only being sold through personal service perfumeries (custom sale). 2. Competitor The main competitors, Guhl’s and Anderson increase market share in1986-1989. In late 1980’s Guhl changed its distribution strategy and started selling the brand on drug chains. As a result, Guhl become aggressive in its marketing through large independents. 3. Customers’ buying behavior: †¢ Dutch women tend to be loyal to their current brands to avoid problems might cause by new product. As a result of consumers’ loyalty, it increases the resistance of switching to new product. Dutch woman typically purchase a facial cream only once or twice a year and have an increasing interests in products with â€Å"natural† ingredients. †¢ Dutch woman are not as familiar with technical product description like the French. They perceived as a technical product and believed its use was very risky. Considering the new brands, first and current customers carefully read package information and ask personal advice. 4. Advertisement The higher spending of advertisement was necessary to develop brand awareness, ideally brand preference. Analysis of problems: – L’Oreal was a leading seller for current market entry, but the share mark et was declining. According to the sample test, the buying intentions increased once the market price had revealed. But it decreased after the actual uses. The actual participants, who would probably not buy the product after using it, increased from 13%-32%. Some negative evaluation of Belle Corleur was due to the fact that Dutch woman tended towards naturally lighter hair colour, and the French towards darker shades. France Belle Couleur was formulated to give a classical conservative dark blond colour with extra reflections or lightening effects. However, the products had not been modified for the Dutch test. The brands needed to be presold since, unlike independent drugstores, there was no sale assistance. However, none of the hair colouring products had a clear advertising positioning statement describing customer benefits. The percentage of woman was not known, nor was the trends in the usage of this method known. Dutch consumers might see the major suppliers of cosmetics and toiletries. But the worries that lied have is that the selling efforts, which is needed in selling the L’Oreal brands in Dutch market. Also at the same time introduce not just one, but two brand name product lines. Generation of alternative solutions Products As per feedback on price, products with wider price range can target on mass market/medium price product market. All the products need to break down to easy term which is easy to understand by simple wording. Market and advertising Expand the market by making it into an open market, which means all the products are available to all different markets. This can be enhanced by advertising with clear statement; and prove to the customers the specifics benefits that they could get by purchasing the products. Advertising Advertise the products through woman magazines; attractive ads that can catch the consumers’ attention and also make them interest towards the products. Advertisement on media such as Tv to show the products concepts and the result of the products after the actual use and customers’ benefit. Market monitoring Monitor the trends to see the changes in the market. From then all the market researches could be done to find the best solution to solve the problem. Personal advertise for better customer service To have personal presold at places for product selling in drug stores, supermarkets, etc. Customers need information whenever they purchase the new products. They all want to know what contains inside the products and the benefits that they could get after purchasing the products. So it is important that customers receive a proper guide through the product line, in order to achieve the customers’ interests towards the products. Promote the products at professional clinics like skincare clinics, or hair salon. After the customers get their facial done, they might decide to purchase the facial products, after they have been advised and advertised by the clinic advisor. Convince customers to switch their brands into something else is hard. In this case, advertisement and unique about the products are the main keys to attract the consumers’ attention and interests. Synergie For the Synergie line, they done the concept tests, but when they reveal the price out to the market, many people have been declined the products. It could due to the fact that the price is too high for the consumers to purchase the products. By lower the price, it could give the company the advantages of getting the interests towards the products. Consumers tend to purchase the products if the product price is at the low price. Belle Couleur When consumers purchase products, they want their product is worth the cost that they paid for. Products need to be totally valued with the quality of its products; and also all the statements about the products need to be a right fact and provide exactly what the qualities placed on the statements/outcomes. There were some negative evaluations on Belle Couleur products line; due to the facts that the products provided fault information, which lead to mistaken by the consumers about the products’ qualities. I. e. different target market has different reaction towards the product line. They don’t have the same or even the similar reaction towards the same products. For example, those Dutch customers tended to like lighter hair colour, when the French customers prefer the darker shades. Due to the market researches of the two product lines, they all get recommended to promote two lines at once. Instead of promote two lines at once, L’Oreal Netherlands can promote one by one; which means that they can promote each one to see how the consumers react to the products. From then, they can decide whether the second product line is necessary needed to be promote out to the market. It can save them the costs in promoting, and also their budget won’t be at waste in advertisement and promotion. It could count as monitoring the current market to see the changes under different circumstances. The product range can be sold at the different locations, such as drugs store and supermarket. Therefore, the advertisements and promotions in these places are necessary in order to catch the consumers’ attentions and interests. Customer service There are numbers of consumers that afraid of purchasing new products, due to the fact that they have bad previous experiences with different products. It is important that marketers can come up with the product’s concepts that provide the trustworthy information to the customers; also it is more important that those provided information can lure away the fear that consumers have, when they purchase for new products. Towards competitions In the global markets, it is impossible for other competitors not copy other products. Stopping it is totally outrages. But every company always have their key ingredients for their products. They always have a backup plan for what they are going to do in the future, if something bad happens. Marketing plan designed Effective monitoring and control system created

Labour Law and Labour Relations Board Research Paper

Labour Law and Labour Relations Board - Research Paper Example The employee filed a LRB complaint since the executive of the union refused to reinstate her employment and it had violated DFR (duty of fair representation). This DFR complaint had a chance of either being successful or not. The purposes of the DFR are in one accord and in good faith represent an employee in bargain of the possible mistreatment or misuse of labor from them. In this instance, though the union had been breached as no one wanted to represent her and the union leader never took the matter for arbitration. The union is held liable if it refuses to represent an employee or when it discriminates against the employee due to race, age, their status in the union, creed, nationality, sex orientation and of course their personality. This is important because it ensures that any course of action in whatever grievance is put forward on the basis of the merit of the grievance in the case. This may be disputed only in the instances when the grievance in the case is not valid. Thoug h in instances of hostility it is not appropriate for the union to decline to arbitrary represent the employee. If the grievance is ill motivated or not of any relevance then the union is free to decline representation. In this case, the employee who had been accused of stealing had to be represented because the union is liable for his well being. In Alberta Labor relations code cases, there was a case where a complainant Craig Shaughnessy filed a duty of fair representation since the union did not represent him fairly during his dismissal from Aluma Systems Inc. He contacted his supervisor who did not help him much either. Eventually the union did not side with the complainant, as they could not the safety issues he claimed to be fleeing from at the time of his departure from the work place without the consent of any authorities. The union further explained to the complaint that he should be responsible of his actions or inactions as he made his own decision on that particular day when he left without consent. He had to accept he complicated the situation for himself. His case was dismissed with this basis in mind. This is the same with the situation which the employee who had been accused of stealing product from the company her chances of reinstatement were almost nil; as it is that she is a victim of circumstance – she had not stolen anything and what she was accused of stealing did not cost anything more than $10. She could not defend herself, as the union did not even consider arbitration for her case. In that case, the termination was left to stand as it was demanded by the union’s executive and thus she had no choice but to accept the situation as it presented itself to her. The union could not defend her as her grievance was of low success probability. Thus, it did not take this case into consideration. The second case is an instance where a unionized employee has had a back related problem and this has resulted in her absenteeism that i s two and half times, the recommended average of the companys’requirement. The company needs to fill the position of this employee with someone whose attendance is more certain and assured. This move is considerably human since the employee did not intend for anything to happen to her while working at the company (Marten,1961). In Alberta Labor Relations Board, Susan Iuni of Rocky view Hospital filed a complaint that her bargaining agent the Canadian Union of Public Employees had failed to represent her fairly in respect to her

Business questions Essay Example | Topics and Well Written Essays - 250 words

Business questions - Essay Example As Jones & George say, consumption and investment rates are highly dependent on the economic aspects and the political scenario respectively (128). The political force, in my opinion, is the major determinant of successful business transactions. Political forces determine whether a society will be peaceful and stable enough to allow for investment. As Lynch indicates, the Chinese would benefit from venturing into the U.S markets as there are fewer trade barriers, alternative energy sources are in plenty, as well as the Chinese are better placed to learn new technologies that could benefit their home markets (1). With the Chinese shifting a lot of focus in the U.S markets, Lynch is of the opinion that U.S.A. will gain from job creations by the Chinese. The Chinese companies have sustained investors with loans, which is shifted to U.S economy (Lynch, 1). With the IMF expecting the Chinese outward investment to augment, the U.S assets are slowly gaining prominence among the Chinese buyers. The U.S markets and economy will automatically grow, while back at home, the Chinese manpower is grabbed by the world’s superpower (Lynch,

The purpose of this project is to better understand the effectiveness Term Paper

The purpose of this project is to better understand the effectiveness of the sling in hunting and combat - Term Paper Example Archaeologists give us a number of answers, one of which points to the use of sling. A sling may simply be explained to be an effective personal projectile weapon that was used in ancient times for purposes of protecting herds, hunting, and combat (York and York 2011: 56-59). Fundamentally, sling was used as a hand-on weapon that was fired by the use of the arm. Users loaded the sling with offensive pellets that included stones and clay. The carriers then spanned the sling in their arms till they felt they had gathered enough force or pressure in the sling before finally releasing it towards their enemies. A very popular story of the use of the sling is told in the story of David and Goliath, where we are told that David used a sling to project a stone against Goliath. There is a lesson learnt from slings here and that is, slings were very powerful weapons and once they were in the right hands, the size of the opponent or target was not a problem. As a shepherd, David was familiar wi th the use of the sling and so he succeeded. It is in this direction that this project is trying to find out how slings could be used effectively to accomplish hunting and combative missions even in today’s cotemporary world. Known history behind the sling Thanks to archaeologists, history behind the sling is fading no time soon. ... Again, history has it the use of sling can be traced to all continents of the world. Archaeologists today have, however, gathered more evidence on the presence and use of the sling in Europe and the Near East (Korfmann 1973: 33-37). What is even more beautiful among the role of the sling in world history is that up to date, the use of the sling are symbolically still in place in areas of the world such as Southern Africa, Pacific Island, Mediterranean and Andean cultures. The slings are used for traditional memorial contests, historical recreations and festival purposes. Much of the history also points to the reasons why the use of the sling started at all. In fact, the use of slings, though became very popular in battle, was not originally meant for that purpose. Knowing that man was basically living with wildlife in the forest in the days of old, the design of the sling was actually necessitated as a weapon for protecting man from carnivores and other dangerous animals that could a ttack them. The sling was found to be preferably for this course because it has the ability to swing its shot to chase the animals, most of which were very athletic. Materials and construction Even in the ancient times, the materials used in the construction of slings underwent a lot of changes. Generally, the weapon was inexpensive to make as its construction involved the use of readily available materials in the human environment. Basically, a sling was constructed to have a cord and a pouch. One ideal factor was that both the cord and the pouch needed not to be elastic. To this end, materials that were used in the construction included animal hide, flax, hair, hemp, plant fibers, sinew and wool. The ideal behind

How to Become More Effective Within the Organization Essay

How to Become More Effective Within the Organization - Essay Example This research will begin with the statement that people in organizations spend over 75 percent of their time in an interpersonal situation. Thus, it is no surprise to find that at the root of a large number of organizational problems is poor communications. Effective communication is an essential component of organizational success whether it is at the interpersonal, inter-group, intra-group, organizational or external levels (How-to Books, online). For human communication to be high in quality or effective, it must take into account not only the choice of language but also the movement of vocal cords, the reception of sound and its translation into neural signals, syntactic and phonological processing. Even facial expressions and gestures influence the quality and outcome of communication. As for the communication message, social psychologists give it three components: content, context, and treatment. Content is the essence of what one person desires to communicate to another, while the context is the way the communicator presents the content of his message to his audience. As for treatment, it is how communication is arranged and conducted by the speaker, which supports the content and context of the message. In a business setting, empathy is vital in communication. Lack of this element is said to be holding down the success of most organizations, where people spend 75 percent of their time in interpersonal, intra-group, inter-group, organizational and external communication.