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Issues Scenario Strategies ChallengesSWOT Implementation

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Bankruptcy Of Nuclear Corporation Of America-Formation Of Nucor

Commodity Nature of Steel Product

Cyclic Nature Of Steel Demand Strong Demand with tight domestic supply in US

Foreign Currency Fluctuation

Dumping of steel in US

Limited Supply of Scrap Steel & rising energy prices Weakened Steel Purchase due to recession in 2000-

2001

Issues Scenario


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2001

Issues Scenario


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2001

Issues Scenario


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2001

Issues Scenario


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2001

Issues Scenario


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2001

Issues ScenarioIssues Scenario Strategies ChallengesSWOT Implementation

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2001


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Issues Scenario

Timeline Description

1954

1965

Operations as a mini-conglomerate, beginning with

the formation of the Nuclear Corporation of America

1964NCA Bankruptcy & F. K. Iverson appointed as CEO &

President

1965

1966

Streamlining of the business, and strategic

realignment around the Vulcraft steel joists division

1966 1970 Expansion in steel joists, and the introduction ofminimills

1972 Company was named as Nucor Corporation

1970 -

1986

Rapid growth in steel production and fabrication

1985 7th largest Steel Company in America(R=$758 million)

1986

1996

Expansion of product line

1996-

2006

Made > 16 acquisitions

2006Having 49 facilities in 17 states became the 2nd

largest Steel producer in North America

2007

Paid a dividend for 135 consecutive quarters- a truly

remarkable accomplishment in a mature & cyclical

industry


1.1 7.6 45.1 58.5 75.1274.5310.9

113162.162.8

1121.51310.3

1757.7

0

200400600

8001000

12001400

16001800

2000

NET EARNINGS( Mn$)

3648

7943

11189 1223713442

1747319109

2046522118

0

5000

10000

15000

20000

25000

1990- 1995- 2000- 2001- 2002- 2003- 2004- 2005- 2006-

PRODUCTION(000 tons)

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Strategies:

New Acquisitions

New Plant Constructions

Continued plant upgrade & cost reductions efforts

Joint Ventures

Worlds 4th largest steel producer in the World

Nucor use scrap steel from recycled steel products

Nucor runs mostly minimills that utilize mostly modern steel making

techniques that gives Nucor a ROA of 16.7% far exceeding the industry

avg of 10%

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Issues Scenario SWOT

Strengt

Strong Leadership team at all levels

Highly motivated, productive, flexible & innovative

work force

Close relationship with major customers

Risk taking & innovative culture

Strong financial credibility

Larger recycler

Weak ess

Almost all Nucor plants are in the US

Energy Intensive

Dependent on Scrap Metals

No internal R & D

No coordination between division for purchase &

sales activities

Opport ities

Expansion to outside of US through Mergers &

acquisitions

Perform market research to understand customerroadmaps

Perform R & D to find new products , technology &

process

Improve inbound & outbound logistics

Export products to emerging markets

T reats

Increased competition by FTAs

Scarcity & rising raw material & energy costs

Cyclical Demands for steel Products Bought over by competitors


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Strengt



work force




Larger recycler

Weak ess


Energy Intensive


No internal R & D


sales activities

Opport ities


acquisitions



process



T reats





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Strengt



work force




Larger recycler

Weak ess


Energy Intensive


No internal R & D


sales activities

Opport ities


acquisitions



process



T reats





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Strengt



work force




Larger recycler

Weak ess


Energy Intensive


No internal R & D


sales activities

Opport ities


acquisitions



process



T reats





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Defensive Strategy: Nucor should have enter into newstrategic alliance, joint ventures for supply of RM toremain competitive

Offensive Strategy : Nucor should invest in R & D simplyto try to stay ahead of the competition by innovatingnew technologies & improving operational efficiency

Vertical Integration Strategy: Expansion to outside ofUS

Apart from the common Bonus System the managerwhose facility is performing best should be givenspecial incentive (pay for performance)

Issues Scenario StrategiesSWOTIssues Scenario Strategies ChallengesSWOT Implementation

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Offensive Strategy : Nucor should invest in R & D simply

to try to stay ahead of the competition by innovatingnew technologies & improving operational efficiency




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Nucor have to make research for alternative rawmaterial & investigate for new supplier whetherthey can give the best deal

Sufficient allocation of financial and humanresources for expansion and also for research anddevelopment activities.

Proper research on the work culture & political

agendas of the regions for the successfulimplementation of company strategy

Mergers & acquisitions with local partners


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Difference in culture ,political agenda etc

Local Competition


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Difference in culture ,political agenda etc

Local Competition


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hhgh

Iss es Sce ario Strategies alle gesSWOT I ple e tation

SM NUCOR

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