The Grey Chronicles

2008.September.8

Conclusion


Several changes occurred in the steel industry for the decade from 1995. Through these years, NSC became privatized in 1995, liquidated in 2000, and then revived in 2004.

NSC’s foray as a private enterprise from 1995 under Wing Tiek then under Hottick has been a tumultuous phase; its flat steel production was subject to forces that would prove fatal to its corporate existence. NSC liquidation in 2000 brought rippling economic effects to the immediate community, in particular, Iligan City, and in general, the Philippines; as well as changed the legal environment for the Philippine steel industry; and threatened Philippine trade relations, especially with Malaysia. The revival of NSC facilities into operative state in 2004 offered new possibilities for the Philippines’ quest to become a new industrialized country by decade’s end; re-opened the question of steel integration—the pursuit for the country’s Integrated Steel Mill; and changed, however minute, the inter-trade of steel products within the ASEAN, AFTA, and WTO communities.

Applying the merged versions of corporate strategic factors introduced by Stevenson (1990), Friedman and Gyr (1998), these forces came from external factors: the omnipresent globalization and trade liberalization, influx of new technology, fierce competition, cyclical steel prices, the hitch of raw materials imports, and the same suppliers of steel imports. The economic conditions and the political scenario might have changed personalities but considering the general state of the Philippines before and at present, most Filipinos, and even foreign observers, would say that it remained unchanged.

In addition, the contemporary internal factors are very similar. Majority of NSC employees were absorbed by both Wing Tiek-Hottick and GSPI. The privatized NSC, both then and now, operated with unchanged rated capacities of various rolling facilities, yet with slightly improved equipment capability. The list of domestic customers dealing with NSC are invariably the same, however, one or two changed their corporate identities. The minimal export steel trade are still that—minimal; and the products offered are HRC, HRP and CRC, although customers’ specifications has became more stringent as ever before. The constantly evolving organizational structure at GSPI patterned from the privatized NSC with additional interrelationships acquired from Ispat. Last but not the least, while the NSC’s ISO9002:1994-certification may have lapsed in 2000, but work processes, systems and standards at still based on these ISO documents and GSPI incorporated many new Ispat-based standards, including Total Productive Management (TPM) activities, and Six-Sigma. On the manufacturing aspect, GSPI introduced a new type of steel grade 1006 and improved production of thin gauge CRC.

Thus, if push comes to shove, although possibly that there is no apple-to-apple comparison with the pre-privatized NSC versus its later rebirths, both as Wing Tiek-Hottick or GSPI, however, the same factors then, from this study’s viewpoint, still exist in the current business environment, albeit different in intensity, focus and personalities.

Atom Henares (2006a) in his foreword to his father’s book series summed it all:

“. . . running of a manufacturing enterprise requires 4 M’s:—money, machines, materials, and the management which combines the first three M’s in productive and profitable relationship. The four pillars of a business enterprise are: the investor who provides the money for financing, the government which takes care of the business environment, the employees who provide the labor, and the consumer who buys its products. It is management that ties them all together – giving the investor an adequate return for his investment; the government the taxes that it needs to run the country; the employee a fair compensation for his work; and the consumer his wants and needs with the highest quality at the lowest price.”


Notes:

Stevenson, William J. (1990). Production/Operations Management. New York: Richard D. Irwin, Inc. & Toppan Co., 3rd ed., 1990, pp. 28-29. back to text

Friedman, Lisa and Herman Gyr (1998), The Dynamic Enterprise: Tools for Turning Chaos into Strategy and Strategy into Action. New York: Jossey-Bass Publications, 1998. pp. 58-65. back to text

Henares, Alfredo Tomas (2006a), Foreword to Give and Take, Make My Day – Book 9 by Larry Henares. Mania: Philippine Folio, 2006. pp. ii-ix. back to text

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