Organizational Analysis - Stemcor

Organizational Analysis - Stemcor

Organizational Analysis - Stemcor

Introduction to the Company

Stemcor Holdings (Stemcor) is one of the largest privately-held steel trading companies based in the UK. It trades around 20,000,000 tons of steel and steel-making raw materials annually through a network of 145 offices in 45 countries globally. Stemcor operates in Europe, Americas, Australia, the Middle East and Asia.

The group's service offerings comprise finance, raw materials, steel trading, distribution and stockholding. Stemcor provides finance for steel-making equipment and working capital requirements for mills and offers business planning consultancy and project management. The group supplies steel producers with raw materials used in the production process. These include iron ore, pig iron, HBI/DRI, coal, coke, ferroalloys and scrap.

Stemcor acts as a steel trading intermediary between producers and purchasers and provide a range of services. The group trades long, flat, tubular and semi-finished products and and semi-finished products. Stemcor also trades specialized products such as engineering steels, stainless steels and steel products for the oil and gas industry. The group offers marketing, logistical and financial services to steel producers and offers sourcing channel with financial support for steel purchasers.

The group's distribution services serve customers who wish to purchase steel on a duty paid basis delivered to their premises on open terms. Its customers include stockholders, service centers and large end users.

Stemcor's offers stockholding services to the steel producers which meets the needs of customers who purchase in smaller quantities for prompt deliveries. In addition, the group provides logistics service comprising of loading, shipping, breaking bulk, storage, insurance, inspection and inland distribution.

Risk Management by Stemcor

Corporate Governance

As a private company, Stemcor is not required to comply with the provisions of the UK Corporate Governance Code. However, the Board of directors is committed to the principles of openness, integrity and accountability embodied in the Code and complies with those aspects which it considers relevant to the Group's size, circumstances and future aspirations.

Analysis of Stemcor's Strategy

The interaction infrastructure must have a corporation monopoly on one aspect, distinguish on one aspect and be on parity on three aspects. When we study considering the case of Stemcor, we analyze that Stemcor most certainly lead on their products. It differentiates in facilitating the access, by establishing its mills near to its target consumers, are on parity in terms of services, but leads the market in terms of costs.

Stemcor attained its reputation as one of the biggest steel manufacturers in the UK by circumspectly keeping a check on the costs, and by greatly considering and realizing the needs of its market. The principal factor behind the success, growth, reputation, and market leadership of Stemcor is its strategy of offering its consumers with the competitive products at matchlessly low prices. The success story of Stemcor lies in their approach of achieving a low cost advantage. Stemcor achieves the low cost advantage because it uses the mini-mills in its production process. These mini-mills are powered electrically, used to molt the steel bars to fabricate the ...