In this paper a case study of US Steel industry has been presented to study the business and management concepts and theories applied in the industry. In this particular case study the problems faced by the industry have been described to make a conclusion of the organizational activities. At the same time the determination of the problems in not enough, the way the problems have been solved can be termed as an integral part of this paper. The activities and measures taken to redeem the problems are very essential to describe as well. Therefore the alternative measures are needed to be presented with supportive theories. Also the strengths, weaknesses, opportunities and threats of the industry have been critically described to make the paper more effective. After reviewing the strengths, weaknesses, opportunities and threats of the industry it is needed to recommend the course of actions preferred for completion of the job. Also the economic environment and the socio-cultural environment of the industry has been presented to bring out the detailed information about this particular industry to present set of plans used by this industry. This case study also enlightens the whole steel industry of US and its techniques to run the organizations.
The case study of US Steel industry combines of four steps process as described below.
Define Problems faced by the industry
In the modern era the steel industry seems to be one of the most profitable industries in US although the pressure on global economy always plays a role in industry like this. In case of identifying the problems of US Steel industry one can find some big issues and a number of relatively small issues. In this paper policies adopted in US Steel industry over past few decades have been discussed and examined to find out how it impacts on the steel industry’s future. Since 1960s US has become the net importer of world’s steel industry as it earned the reputation of dominant of the world steel industry (Worrell et al.). But in early 1970s the market shares had dropped significantly led to Voluntary Restraint Agreements (VRA) with European community and Japan. In forthcoming years Bush administration was involved to create safeguard for the steel industry creating policies like antidumping (AD), mechanisms and countervailing duty (CVD) (Blonigen, Liebman and Wilson). A number of trade policies had been introduced to create trade protection of the industry. Basically some of the US trade policies resulted steel import at its highest point. But some of the trade policies on the other hand brought tariffs to the industry that caused lower volume in imports. Such policies impacted on marginal cost and removal of price. Apart from that some of the companies of this industry facing problems with funds as cost of the metal prices are down significantly as there is so much uncertainty in the global economy. The impact of cost reduction has direct impact on US Steel industry (Blonigen, Liebman and Wilson). The margin is constantly going downwards which is a worry to say the least.
Formulated substitute courses of action to resolve problem
In pressure situation like this when the uncertainties of global economy is on the verge of the industry it is needed to follow a number of actions to resolve the problems. For the industry the helping hands from the US government can be a huge boost. Apart from that the management of the industry needs to act as per doctor’s order to control the expenses. For completing the jobs in hand the industry requires to buckle up as soon as possible. Need to find efficient workers for the jobs who can invent some ideas to bring the manufacturing cost down. The main actions should be taken on controlling the damage as prices of the commodity in the global market is deeply going down for a number of reasons all over the global (Blonigen, Liebman and Wilson). The demand can become a serious issue if the global economy will not improve significantly. Some legal actions need to be taken to claim the money restricted in the market. Also the improvement in modern technology in the heavy metal can be a reason of some relief as it controls the manufacturing cost to some extent.
Analyzed substitute courses as per strengths and weaknesses of the industry
Depending on the current situation of the US Steel market and global economy condition it is important to analyze the alternative actions as per the strengths and weaknesses of the industry. Most importantly it is highly important to reduce the import tariffs from the end of the government. On the other hand the recycle of the steel can be an important thing if the industry wants to save manufacturing cost (Blonigen, Liebman and Wilson). Apart from that introduction of new technology to the steel industry can bring down the prices significantly. As per the strengths of the industry it can be mentioned that steel production industry can survive such tough times if prompt measures and decisions have been followed. Research and development section can also be improved to create some new strategies to maintain the industry without expending much capital.
Recommended course of actions
Assuming the strengths and weaknesses of the industry it is eminent to recommend a dominant trade policy particularly for this very industry. By reviewing the financial data critically it is very essential to take prompt steps by the federal government. Capital and energy related deals are needed to be introduced to strengthen the industry. Mini-mill manufactures of US Steel industry should be looked after carefully to ensure the growth of small producers in the industry. US steel industry is said to be the dominant importers of steel. Therefore secure trade policies can be very effective to revive the industry. If the economy of the world recovers a little bit it would be a lifting for the US steel industry anyway but that is an optimistic appeal. Besides the investors should be asked to pay attention to the industry as the US Steel industry has enough potential to achieve new heights if market circumstances and global economy support a bit.
Environment of the industry
The economic environment and socio-cultural environment of the US Steel industry have been described below.
The economic environment of the industry has most effect on firms, corporations and management programs of the US Steel industry. Global economic condition can be termed as one of the major factors experienced by the industry. Current unfriendly conditions of the markets create fewer opportunities for the industry to grow. At this point high employment can be considered as one of the most estimated concerns towards the firms of the industry (Worrell et al.). The pressure of global uncertainty always pushing the industry and as a result of this the increasing prices of manufactured products causing no help. In one hand the manufacturing cost is kept alarmingly increasing, on the other hand the profitability is going down creating pressure on the firms of the steel industry.
On basis of socio-cultural environment it can be seemed that the popularity of steel industry in the US has decreased significantly. evidences has confirmed that current investors are more comfortable in putting their money on other comparative industry rather than steel industry as profit margin is very significant on other industry in comparison to this. Also the changing market of steel industry has seen a shrink as a result of global economy (Worrell et al.). The import of steel has also declined as data from the authorities has shown. Shifting capital from steel industry can be a sign of worry to say the least as per market experts suggest.
At the end of the research paper it is essential to mention that current factors and market indicators are not looking good as far as US Steel market has concerned. Drastic steps are needed to be taken by the government and the concerned authorities to repair the industry. Decrease in metal prices making things worse and there is no sign of improvements. All the big players of the global economy have playing waiting games. Most probably the import of steel can be checked for some time. It is important to catch the attention of the investors once again so that the industry can apply new ideas. Unanimous decisions and policies supportive for the industry needed to be invented sooner than later to lift the economy as well as the industry.
Blonigen, Bruce A, Benjamin H Liebman, and Wesley W Wilson. Trade Policy And Market Power. Cambridge, Mass.: National Bureau of Economic Research, 2007. Print.
Blonigen, Bruce A., Benjamin Liebman, and Wesley W. Wilson. 'Antidumping And Production-Line Exit: The Case Of The US Steel Industry'. Review of Industrial Organization 42.4 (2013): 395-413. Web.
Worrell, Ernst et al. Voluntary Agreements For Increasing Energy-Efficiency In Industry. Berkeley, Calif.: Lawrence Berkeley National Laboratory, 2003. Print.