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May 5, 2006

Nucor and Its Culture: An Example for the Rest of U.S. Manufacturing

BusinessWeek has a terrific profile of Nucor, the country's largest steelmaker. Consider Nucor's practices and successes in light of Ford, for example, and it's hard not to come to the conclusion that the difference between the two comes down to one thing, management:

At Nucor the art of motivation is about an unblinking focus on the people on the front line of the business. It's about talking to them, listening to them, taking a risk on their ideas, and accepting the occasional failure. It's a culture built in part with symbolic gestures. Every year, for example, every single employee's name goes on the cover of the annual report. And, like Iverson before him, DiMicco flies commercial, manages without an executive parking space, and really does make the coffee in the office when he takes the last cup. Although he has an Ivy League pedigree, including degrees from Brown University and the University of Pennsylvania, DiMicco retains the plain-talking style of a guy raised in a middle-class family in Mt. Kisco, N.Y. Only 65 people -- yes, 65 -- work alongside him at headquarters.

At times, workers and managers exhibit a level of passion for the company that can border on the bizarre. Executive Vice-President Joseph A. Rutkowski, an engineer who came up through the mills, speaks of Nucor as a "magic" place, representing the best of American rebelliousness. He says "we epitomize how people should think, should be." EVP Ferriola goes even further: "I consider myself an apostle" for the gospel of Ken Iverson. "After Christ died, people still spread the word. Our culture is a living thing. It will not die because we will not let it die, ever."

Unusual? No Doubt. But Vijay Govindarajan, a professor at Dartmouth College's Tuck School of Business, teaches Nucor as an example of outstanding strategic execution, placing it alongside highfliers such as JetBlue Airways and eBay. "My students say: 'I thought Nucor created steel.' And I say: 'No. Nucor creates knowledge."'

Posted by John on May 5, 2006 5:25 AM

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