Nucor 2009

Topics: Birmingham, Alabama, Asset, U.S. Steel Pages: 24 (4512 words) Published: March 7, 2013
Nucor Corporation
What does a SWOT analysis reveal about Nucor’s situation? Does Nucor ?have any core or distinctive competencies

In the case of Nucor Corporation there are several factors that need to be addressed while doing its SWOT analysis. Nucor steel is made up of approximately 21,000 employees and their main goal is to take care of their customer which is stated in their mission statement. Nucor has remained to be an innovative company focusing on finding out and implementing new technologies to cut costs and become more productive.

Nucor’s corporate directional strategy distinctively comprises growth concentration strategies (enveloping vertical and horizontal). Ken Iverson initially focused Nucor in the joist business before incorporating vertical growth through backward integration into steel mills as their core business to reduce supply costs; forward integration into miscellaneous steel product industries e.g. fasteners, bolts and bearings; and strategic alliances in Nucor e.g. CVRD. Collaterally, Iverson expanded Nucor through various acquisitions (such as Sumitomo Corp and Auburn Steel) to fuel horizontal growth.

Innovation and technology has been the integral strength for Nucor Co. They are always into searching for new mediums and technology in the production side. The major benefit that they get from it is the amount of resources that they save and the improved efficiency levels.

Continuing Innovations
They also have plants with low pollution levels. The ability for Nucor to use this to its advantage allows them to be more competitive with the market by substantially lowering their production cost. It also allows them to be environmentally friendly a huge worldwide concern these days. Continuing Innovations allows Nucor to continue to hold its technological edge on the competition. Nucor is always moving and always improving its business cycle through the use of continuing innovation. Nucor is an industry leader when it comes to innovation.

Lean Management
Corresponding to their lean business style, Nucor is constantly striving for improvement. A constant goal to reduce production cost is always a priority and ultimately helps to lower costs of steel to buyers. Additionally, a focus on treating employees well helps reduce employee turnover and increase productivity.

Employee wages provide another example of Nucor’s respect for employees. Nucor’s employees are often paid up to three times the local average manufacturing wage. All in all, the high level of employee respect helps Nucor to employ workers that care about their job and thus work harder and are more productive then others in outside manufacturing firms. Joint Ventures and Acquisitions

The very recent acquisition of the David J. Joseph Company, one of the leading scrap companies in US has allowed Nucor to basically own its primary supplier of scrap metal along with 2,000+ rail cars for transportation between business entities. It has essentially guaranteed Nucor an in house supplier. Weaknesses

Location: Congregated itself in US
A major weakness for Nucor is that it has congregated itself in US. All of the 14 plants of Nucor are located within different states in US. The major problem that arises due to this is that Nucor cannot effectively cater to international markets as compared to its competitors who have plants worldwide. Distribution and shipping costs are very high in the steel industry and shipping it to overseas countries is a lot difficult and expensive for Nucor. Nucor needs to re-position itself in the market to effectively compete with its competitors. Secondly, Nucor does not also gives deals on its quantities purchased.

US Real estate and Auto-market
Nucor also does not give deals on quantities purchased. Nucor’s most significant weakness lies with its domestic market. With the US market being Nucor’s primary customer base, Nucor is not able to offset losses because of a diversified...
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