To analyze Nucor’s strategy, we can use strategic triangle.
The goal of Nucor is to become the most productive steel maker in the world with the highest quality and lowest costs.
The main product lines are steel bars, cold finished steel, steel joists and steel sheets. Therefore, the target customers of Nucor are automobile makers, constructions, and other manufacturers.
The positioning of Nucor’s products is low price. The strategy used by Nucor is cost leadership.
For the main activities of Nucor, we can do value chain analysis. The value chain of Nucor is as the following:
(1) Management/Culture(2) R&D(3) Inbound Logistics(4) Operations(5) Out bound Logistics (6) Marketing/Sales(7) Service Customer
1. Management/Culture: Nucor …show more content…
The efficient and effective management team is also a success factor.
The effective management team and culture have long term benefits and is hard to be imitated by competitors, therefore, it is VRIO.
2. R&D: Nucor does not have internal R&D, but it keeps seeking and adopting new steel making technologies. It serves as its own general contractor and design and build many equipment, which helped Nucor to reduce costs.
R&D is essential for steel makers to keep reducing costs, therefore it is valuable. However, it is not difficult for competitors to imnitate. Therefore, R&D is not VRIO.
3. Inbound Logistics: In 2002, Nucor entered joint venture with CVRD which is the world’s largest iron-ore pellets manufacturer. By doing this, Nucor could produce steel by using iron ore and coke instead of using traditional materials – scrap steel. In addition, Nucor uses pull approach to control material usage and thus increasing …show more content…
Therefore, it is not VRIO.
4. Operations: Nucor has high quality control, and it reinforce the quality by giving bonuses to employees when they produce steels meet the quality requirements. As mentioned above, Nucor has productive, flexible and motivated workforce, which enable Nucor to produce steel efficiently. In addition, Nucor has efficient work-in-process inventory management process.
The efficient operation is valuable but is not rare and easily imitated by others. Therefore, it is not VRIO.
5. Out-bound Logistics: Nucor established co –location relationship with their major customers. The customers tend to locate next to Nucor’s plants in order to have lowest costs. As a result, Nucor did not need to establish outbound logistics. However, this co-location is restricted in the United States, it cannot apply if Nucor expends to global markets. Therefore, outbound logistics is sustainable for long-term success, and it is not VRIO.
6. Marketing/Sales: Nucor mainly target on domestic customers which are close to it. Nucor also focus on establishing long-term relationships with its customers. Each individual plants conduct their own marketing and sales. Marketing is valuable, however, it is not rate. Therefore, it is not
The goal of Nucor is to become the most productive steel maker in the world with the highest quality and lowest costs.
The main product lines are steel bars, cold finished steel, steel joists and steel sheets. Therefore, the target customers of Nucor are automobile makers, constructions, and other manufacturers.
The positioning of Nucor’s products is low price. The strategy used by Nucor is cost leadership.
For the main activities of Nucor, we can do value chain analysis. The value chain of Nucor is as the following:
(1) Management/Culture(2) R&D(3) Inbound Logistics(4) Operations(5) Out bound Logistics (6) Marketing/Sales(7) Service Customer
1. Management/Culture: Nucor …show more content…
The efficient and effective management team is also a success factor.
The effective management team and culture have long term benefits and is hard to be imitated by competitors, therefore, it is VRIO.
2. R&D: Nucor does not have internal R&D, but it keeps seeking and adopting new steel making technologies. It serves as its own general contractor and design and build many equipment, which helped Nucor to reduce costs.
R&D is essential for steel makers to keep reducing costs, therefore it is valuable. However, it is not difficult for competitors to imnitate. Therefore, R&D is not VRIO.
3. Inbound Logistics: In 2002, Nucor entered joint venture with CVRD which is the world’s largest iron-ore pellets manufacturer. By doing this, Nucor could produce steel by using iron ore and coke instead of using traditional materials – scrap steel. In addition, Nucor uses pull approach to control material usage and thus increasing …show more content…
Therefore, it is not VRIO.
4. Operations: Nucor has high quality control, and it reinforce the quality by giving bonuses to employees when they produce steels meet the quality requirements. As mentioned above, Nucor has productive, flexible and motivated workforce, which enable Nucor to produce steel efficiently. In addition, Nucor has efficient work-in-process inventory management process.
The efficient operation is valuable but is not rare and easily imitated by others. Therefore, it is not VRIO.
5. Out-bound Logistics: Nucor established co –location relationship with their major customers. The customers tend to locate next to Nucor’s plants in order to have lowest costs. As a result, Nucor did not need to establish outbound logistics. However, this co-location is restricted in the United States, it cannot apply if Nucor expends to global markets. Therefore, outbound logistics is sustainable for long-term success, and it is not VRIO.
6. Marketing/Sales: Nucor mainly target on domestic customers which are close to it. Nucor also focus on establishing long-term relationships with its customers. Each individual plants conduct their own marketing and sales. Marketing is valuable, however, it is not rate. Therefore, it is not