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Nucor Case Study

In: Business and Management

Submitted By Kulraj
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Why has Nucor performed so well ?

Mini-mill effect
Low cost competitive strategy

Organization structure :
Superior human capital
Decentralized & flat structure with autonomy to plant General managers without information system overload.
HR policies for encouraging innovation & optimum productivity
Tolerance to experimentation & willingness to take risk

Approach to control :
Information system : Weekly reports, Monthly reports, Meeting of all plant GM’s 3 times a year
Metrics based Incentive plan based on nature of job

Important aspects of Nucor’s overall approach to organization and control & their fit with the company’s strategic requirements?
Strategy:
Build facilities economically & operate productively
Continuous innovation
Delegation with information
Max D:E of 30%
Approach to organization structure :
Superior human capital
Decentralized & flat structure with autonomy to plant General managers without information system overload.
HR policies for encouraging innovation & optimum productivity
Tolerance to experimentation & willingness to take risk
Approach to control :
Information system : Weekly reports, Monthly reports, Meeting of all plant GM’s 3 times a year
Metrics based Incentive plan based on nature of job

Mechanisms to accumulate knowledge in individual plants
A weekly report per plant sent to headquarters on the operations-related variables:
A monthly report comparing actual to budgeted figures for sales revenue, costs, contribution, and return on assets employed
Mechanisms to facilitate sharing this knowledge among its 25 plants
All the plant general managers met as a group with headquarters management three times a year detailed performance data on each plant were distributed to all plant managers on a regular basis
Plant general managers and machine operators also commonly visited each other's mills…...

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