Diversification Strategies: Nucor Corporation Case Study
HRM Issues/Diversification Strategies
Jamaine Williams
Instructor Dr. Hogan
Bus599
February 29, 2012
Abstract
In this paper, I will present an analysis of Nucor Corporation. The paper will discuss the trends in the steel industry and how it may impact Nucor’s strategy, Discuss the organizational structure and management philosophy at Nucor, Identify three (3) HRM issues related to strategy implementation and recommend actions to address these issues, Based on the situation, recommend whether a related or unrelated diversification should be used by the company. Provide supporting rationale. Also my Recommendation whether a related or unrelated diversification should be used will also be discussed.
1. Discuss the trends in the steel industry and how it may impact Nucor’s strategy.
Blast furnaces were the trend for the major steel producers. The arc furnaces adopted by Nucor led to increased production and cost savings. While using less labor, increased production, and was considered the new most cost-effective strategy among the steel industry the new technology took off. It was Nucor’s first to come up with the decision to adopt this process and be the first to introduce this new process to the United States. In the late 90s into the 2000s man steel companies went out of business because of the reduce demand for steel. Instead of building new plants and using funds Nucor chose to buy the failing plants and converting them into their production lineup. This also in many cases was a cheaper route than building new plants. The procurement strategy was one of the best moves because the factories were already setup for steel production at mass quantities and Nucor was able to inherit their ties and partnerships as well as their presence in their surrounding geographical area. The constant drive for efficiency and cost effective production was another strategy chosen to increase competitive advantage, market share, and
Jamaine Williams
Instructor Dr. Hogan
Bus599
February 29, 2012
Abstract
In this paper, I will present an analysis of Nucor Corporation. The paper will discuss the trends in the steel industry and how it may impact Nucor’s strategy, Discuss the organizational structure and management philosophy at Nucor, Identify three (3) HRM issues related to strategy implementation and recommend actions to address these issues, Based on the situation, recommend whether a related or unrelated diversification should be used by the company. Provide supporting rationale. Also my Recommendation whether a related or unrelated diversification should be used will also be discussed.
1. Discuss the trends in the steel industry and how it may impact Nucor’s strategy.
Blast furnaces were the trend for the major steel producers. The arc furnaces adopted by Nucor led to increased production and cost savings. While using less labor, increased production, and was considered the new most cost-effective strategy among the steel industry the new technology took off. It was Nucor’s first to come up with the decision to adopt this process and be the first to introduce this new process to the United States. In the late 90s into the 2000s man steel companies went out of business because of the reduce demand for steel. Instead of building new plants and using funds Nucor chose to buy the failing plants and converting them into their production lineup. This also in many cases was a cheaper route than building new plants. The procurement strategy was one of the best moves because the factories were already setup for steel production at mass quantities and Nucor was able to inherit their ties and partnerships as well as their presence in their surrounding geographical area. The constant drive for efficiency and cost effective production was another strategy chosen to increase competitive advantage, market share, and
References: Nucor Corp 's Organizational Culture. (2003). Retrieved February 29, 2012, from ICMR IBS Center for Management Research: http://www.icmrindia.org/casestudies/catalogue/Human%20Resource%20and%20Organization%20Behavior/HROB036.htm Thompson/Strickland/Gamble. (2009). Cafting & Excuting Strategy. McGraw-Hill Lening Solutions.