1. Erum Syed Mirza Ehtesham Napacha Suttitum Santid Panichapong
Safety First. No one gets hurt on our shift today.
Presented by:
Erum Syed
Mirza Ehtesham
Napacha Suttitum
Santid Panichapong

2. Overview External Analysis Internal Analysis
Safety First. No one gets hurt on our shift today.
External Analysis
General Environment Analysis
Driving Forces
Porter’s Five Forces
Key Success Factors
Internal Analysis
Organization Analysis
Financial Analysis
Strategic Analysis
Core Competencies
SWOT Analysis
Recommendations

3. External Analysis External Analysis
Safety First. No one gets hurt on our shift today.
External Analysis
General Environment Analysis
Driving Forces
Porter’s Five Forces
Key Success Factors

4. General Environment Analysis
External Analysis
Safety First. No one gets hurt on our shift today.
General Environment Analysis
General Environment
TREND
Demographic
POSITIVE
Political
Socio-Cultural
Technological
Economic
Global

5. Driving Forces External Analysis Technology Economic Climate
Safety First. No one gets hurt on our shift today.
Driving Forces
Technology
Cost reduction
Innovative processes
Economic Climate
low interest rates
Increasing Steel demand

6. Five Forces Competitive Analysis
External Analysis
Safety First. No one gets hurt on our shift today.
Five Forces Competitive Analysis
Threat
of New
Entrants
LOW
Power of
Suppliers
Power of Buyers
Rivalry Among
Competitors
HIGH
HIGH
HIGH
Threat of
Substitutes
LOW

7. External Analysis Key Success Factors
Safety First. No one gets hurt on our shift today.
Key Success Factors
Lowering
Operation
Cost
Increase
Market
Share
Innovative
Techno
logies
Environ
mental
Friendly

8. Internal Analysis Internal Analysis Organizational Analysis
Safety First. No one gets hurt on our shift today.
Internal Analysis
Organizational Analysis
Financial Analysis
Strategic Analysis
Core Competencies

9. Organizational Analysis
Internal Analysis
Safety First. No one gets hurt on our shift today.
Organizational Analysis
Daniel R. DiMicco since Sep 2000
Organization
NUCOR
Mission / Goal
“Take Care of Our Customers.”
Leadership
CEO: Daniel R. DiMicco (55)
Organization Culture
Zero lay off / Innovative
Structure
Decentralized

10. Products Internal Analysis
Safety First. No one gets hurt on our shift today.
Products

11. Financial Analysis Internal Analysis P / E Ratio Revenue Growth
Safety First. No one gets hurt on our shift today.
Financial Analysis
P / E Ratio
Revenue Growth
Net Margin

12. Financial Analysis Internal Analysis ROE ROA
Safety First. No one gets hurt on our shift today.
Financial Analysis
ROE
ROA

13. NYSE Internal Analysis
Safety First. No one gets hurt on our shift today.
NYSE
EPS
Dividend Yield
Price : (12/1/06) 
52 Wk High 61.70
52 Wk Low 32.18
NUE

14. Core Competencies and Sustainable Advantages
Internal Analysis
Safety First. No one gets hurt on our shift today.
Core Competencies and Sustainable Advantages
Valuable Capabilities ?
Yes
Costly-to-imitate ?
Rare Capabilities ?
Non-substitutable ?
Result: Nucor has sustainable competitive advantage and its performance implications rated in above average returns

15. Strategic Analysis Internal Analysis Corporate Level Business-Level
Safety First. No one gets hurt on our shift today.
Strategic Analysis
Corporate Level
Optimize existing operations
Use Greenfield technology
Acquisitions
Go Global
Business-Level
Low-end products
Highest quality mini milled steel
Offer low and competitive prices
Lean management style

16. SWOT Analysis SWOT Analysis
Safety First. No one gets hurt on our shift today.
SWOT Analysis

17. SWOT Analysis SWOT Analysis Strengths Financial Strength
Safety First. No one gets hurt on our shift today.
SWOT Analysis
Strengths
Financial Strength
Technology innovator
Decentralized business units, high employee empowerment
Opportunities
Acquisition strategies
Leverage, extend technology advantage
High Demand
Weaknesses
High cost of Mini mill operation
Exposure to economic, business cycles of customers
Lack of international presence
Threats
High price of raw material
Increasing consolidation /Oversea competitors
Changes in the cost of electricity and natural gas

18. CURRENT PRODUCTS/SERVICES NEW PRODUCTS/SERVICES
SWOT Analysis
Safety First. No one gets hurt on our shift today.
Alternatives
CURRENT PRODUCTS/SERVICES
NEW PRODUCTS/SERVICES
CURRENT MARKET
MARKET PENETRATION
New processes to reduce energy costs
Acquire existing steel firms in US
Low-cost productivity
PRODUCT DEVELOPMENT
Technology initiatives in Hismelt, Strip casting
Modification in steel making process
NEW MARKET
MARKET DEVELOPMENT
Acquisition in India investment in China
Joint venture with foreign companies
Acquisition of a current supplier
DIVERSIFICATION
R & D initiatives

19. Recommendations Recommendations Reduce energy cost by Wind Turbine
Safety First. No one gets hurt on our shift today.
Recommendations
Internal Strategy Recommendation
Reduce energy cost by Wind Turbine
External Strategy Recommendation
Acquisition in India

20. Recommendation 1 Recommendations Reduce energy cost by Wind Turbine
Safety First. No one gets hurt on our shift today.
Recommendation 1
Internal Strategy Recommendation
Reduce energy cost by Wind Turbine

21. Internal Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Objectives
Implementation of wind turbines at five of its existing plants
Locations: Auburn, Chemung, Denton, Norfolk, Seattle
12 month project
$2.5 million per turbine
Total budget of $13.5 million

22. Internal Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Locations
Auburn, NY
Chemung, NY
Denton, TX
Norfolk, NE
Seattle, WA

23. Justification Internal Strategy Recommendation Reduce energy costs
Safety First. No one gets hurt on our shift today.
Justification
Regular Electricity Consumption
Average cost of electricity per Kilowatt (cents)
9.015
Average production of steel at five plants (tons)
2,000,000
Average electricity consumed by five plants (KW)
1,133,000,000
Total Electricity Cost
$1,018,751,831
Electricity Consumption with Wind Turbines
Electricity Production with five wind turbines (KW)
23,470,000
Cost of purchasing 23,470,000 KW from Electric company
$ 2,115,821
Reduce energy costs
Reduce production costs
Environmentally friendly
Payback period of 6.2 years
$4.48 million NPV

24. Internal Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Deliverables
Five wind turbines will be purchased from G.E Co.
Five plants with one 1.5 Megawatt/hr. wind turbine each
The total capacity will be 13,140 Megawatts

25. Implementation and Milestones
Internal Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Implementation and Milestones
Initiate immediately for all five locations
12 month of installation and conversion
Wind turbines will generate portion of mini mills electrical demand

26. Internal Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Risk Analysis
Purchasing/Installation costs may rise
Actual savings less than expected savings

27. Internal Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Long Term Effects
Financial Implications (12 month project)
Saving of $2 million in electrical expense per year
Recovery of initial investments in 6.2 years
Promote “going green” image
Base for future expansion of this project

28. Recommendations 2 Recommendations External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Recommendations 2
External Strategy Recommendation
Acquisition in India

29. External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Objective
Acquisition in India
Global presence of Nucor outside of the United States
Acquire small companies in India such as MSP Steel and Power Ltd.
12 Month Period
Budget of $20 million
Lower production costs

30. External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Justification
Steel consumption is on the rise globally
Explore international markets
Shift production to low-cost countries
INCOME
MSPL : National Stock Exchange of India

31. External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Deliverables
Acquisition of MSP Steel in India within
12 month period
Nucor will invest $15.33 Million
Incorporate new and advanced technologies

32. Implementation and Milestones
External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Implementation and Milestones
Acquisition in India should be initiated immediately
Follow the acquisition steps
Implement modifications to the existing steel company

33. External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Risk Analysis
Not enough return back on investments
Sudden decrease in the demand for steel
Uncertainty of raw material supply

34. External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Long Term Effects
Gain competitiveness
Cut production costs
Strong domestic growth in India

35. Conclusion Conclusion Driving Forces Key Success Factors SWOT
Safety First. No one gets hurt on our shift today.
Conclusion
Driving Forces
Key Success Factors
SWOT
Action Plans
Success

36. Thank You For Your Time & Attention
External Strategy Recommendation
Safety First. No one gets hurt on our shift today.
Thank You For Your Time & Attention