Strategic Management in Steel Industry - Dissertation Example

As Johnston(2006) states, “In fact, on one measure of globalization of the steel industry the geographical spread of steel production since 1949 it can be attributed in large part to the determination of governments, particularly in developing countries, for rational economic and strategic purposes as well as prestige reasons to build national steel industries: hence the urgent need for the strenuous and prolonged efforts of the OECD to achieve a binding international agreement to eliminate public subsidies for steel-making investment which distort competition.

A second view at the other extreme denies that globalization in the diversification of production and the rapid expansion of trade flows, evident in the steel industry as in many other sectors, have reduced significantly the influence of governments and their capacity to develop coherent and effective national economic policies. Trade flows within countries are nearly always much more voluminous than those between countries even in the European Union where regional economic integration is most advanced.

Even in the EU countries significant price differences for steel goods as for other products, persist which is not what would be expected in a free internal market relatively open to third-country imports. With this understanding, it might appear that the evident differences in economic and social policies among OECD governments are explicable as rational responses to the real world, based on democratic political choice, free of overriding concerns to liberalize national economies”.In order to run the steelmaking and the steel selling business profitably-which often is set up at massive deployment of capital and manpower requiring setting up large scale steel plants; it has become virtually necessary to plan the operations and policy along the strategic lines.

In fact, strategic management gives a way of approaching the various issues in any business along scientific lines so that business objectives are attained in an orderly and timely manner.