NUCOR CORPORATION

PRESENTED BY:

SAMUJJAL BHATTACHARJEE

BHAVNA AGRAWAL

KARAN VEER SINGH

ABHINAV SINGH

SAQUIB MUNEER

INTRODUCTION

Nucor started as a auto manufacturing company than later converted itself into the Nuclear and Electronics business in 1950’s and early 1960’s

After the firm suffered several money losing years Ken Iverson took charge as the president

After Iverson took charge he consolidated company on two businesses viz making steel from recycled scrap metal and fabricating steel joists for use in non residential construction

Contd…

In 1972 the firm changed its name to Nucor corporation

By 1998 it became America’s second largest steel maker and also was in Fortune 500 company

Nucor’s sales during Iverson’s tenure grew at an annual compound rate of about17% per annum

In the corresponding years both Nucor CEO John Correnti and Iverson were named steel maker of the year

Operations of Nucor

Nucor located its diverse facilities in rural areas across the United States

It established strong ties to its local communities and its workforce

Nucor selected operations in states with tax structures that encouraged business growth

Contd…

Nucor’s top management favoured the company’s commitment to remaining union free

Nucor and its subsidiaries consisted of nine businesses, with 25 plants

Strategies

Continuous Innovation Usage of modern equipment Individualized customer service Usage of scrap metal No acquisitions and mergers Usage of low debt in total capital No diversification

Organization Structure

Decentralized system Four management layers:

Chairman/Vice chairman/PresidentVice President/Plant General Manager

Department ManagerSupervisor

Contd…

Autonomy to the General Manager in decision making

Nucor’s board of director’s had only six members

The decision making was done by the individual plant’s General Manager and they were not liable for the Headquarters to respond to the problems

There were a total of 6800 employees working in the company

Human Resource Policies

Employee relations at Nucor were based on 4 principles:

Employees would earn according to their productivity

Employees should feel confident that if they do their jobs properly, they would have a job tomorrow

Employees have the right to be treated fairly

Employees have an avenue of appeal when they believe they are being treated unfairly

Cotnd…

General manager were required to hold annual dinners with every employee

Commitment for no lay off during recession period

No unionism Policy of team work Suggestions from lower level employees

are taken into consideration

Compensation

Four compensation plans

Product incentive plan Department manager incentive plan Non-production and non-department

manager incentive plan Senior officer incentive plan

Information systems

Each plant has to submit a snapshot of the plants basic operations on a weekly and monthly basis

Managers do not have to submit voluminous reports instead they need to submit the actual and budgeted figures

The plant General managers met as a group with head quarters management three times a year to review each plant’s performance

Benefits

Profit sharing Scholarship programmes Stock purchase plan Commitment of providing equal status On the job training Job referrals through existing employees

Technology

Use of mini-mill technology

Backward integration

Modernizing the existing plants

Technology management

Application of MCS

Responsibility centre Expense centre Goal congruence Management performance Economic performance

Conclusion

Nucor’s overall approach towards organization and control has paid rich dividend in the growth of the company

Their ability to be a successful first mover in the adaption of new technology is remarkable

Although the company has done well for the last 25 years but still with the prevailing market conditions they need to think about diversification and mergers & acquisitions