The Grey Chronicles

2008.September.17

Recommendations for Future NSC: W-T Strategies


W-T Strategies: To diminish the threats (T) into weaknesses (W), and then possibly revamp these into strengths, the following strategies are recommended:

Partner with national agencies to address compensation package. (W2, W4, T1, T4) GSPI could seek the help of locally based government agencies to address the disparity in compensation package. For more than two years since 2004, there were no promotions, no salary increases for hired locale employees. This disparity seems less among management’s priorities, but the impact to productivity is huge. Most rank and file are handled by local supervisors. If these supervisors form their own union, during NSC era there were two contending groups representing the level, thus this is a potential threat to productivity.

Study viability of SCADA, self-generation and mechanics of WESM. (W3, T2). Monitoring of electric power usage at NSC facilities used traditional meters, and these are located on some entry points only. No individual meters are available on a per mill basis, thus load scheduling and load shedding cannot be effectively done. Supervisory Control and Data Acquisition (SCADA) systems or an Energy Monitoring System (EMS) have been used by steel mills the world over, and they surely are applicable to GSPI scenario.

With the WESM on its initial stages of spot market tests, GSPI being a large user of electric power should be prepared to have a competent and WESM-accredited electricity broker upon the implementation of open access (Mendoza, 2007). Furthermore, a technical feasibility and economic viability study of self-generation of power for GSPI could also offer another option.

Partner with steel end-users on Tariff resolution. (W1, W5, T3). In contrast, on May 24, 2002, China has set custom duties on steel imports ranging from 18% to 26% depending on the type of steel products (China Watch, 26 July 2003)

Also, on December 20, 2001 the US International Trade Commission recommended: a four-year program on tariff and tariff-rate quotas for plate, hot-rolled, cold-rolled and coated sheets 20% for the first year, 17 for the second, 14% for the third and 11% for the fourth (Walker, 2002).

Similar rates should be vigorously pursued to protect investments. It is hoped that dumping of steel products be reduced to a minimum if the tariff rates are imposed favorable to all players in the Philippine steel industry, not just one company.

Augment legal pay with perks and fringe benefits. (W4, T4). Wing Tiek-Hottick NSC offered competitive salaries comparable to other multinationals in the country. Not just that but also with a comparable package of other benefits on top of those mandated by law which extends beyond what was required by the Collective Bargaining Agreement, notable of which are: maternity, hospitalization, 100% cost-free medicines, free infirmary services, housing loans, insurance, dependents scholarship, corporate wellness, 1.5 months per year of service retirement, and bereavement assistance. (NSC News, August 1992)

All these paved the way of harmonious relationship between management and union during NSC (NSC News Supplement, October 1992).

The matter of unionism at GSPI, as explained in the SWOT fourth weakness (W4) above, however, remains on deadlock with management not budging on its first and last offer of economic benefits.

Although, GSPI offered volume production incentive for its pickling line and rolling mills since 2005, citing their bottleneck constraints, thus other production lines have been deliberately excluded. Several supervisors have pointed out this discrepancy since then, but suggestions for correction have not been heeded, aside from the delayed disbursement of deserved incentives.

Update Environmental Monitoring equipment and beef-up EMS personnel. (W4, T5) Most environmental monitoring equipment was sequestered by NSC liquidator, as added-value equipment to manufacturing. With the global thrust of protecting the ecology and the environment (Cola, 1993), such equipment are vital to the issuance and renewal of an Environmental Certificate of Compliance by the DENR, without which GSPI could end up like Sonic Steel Industries.

Sonic operates a galvanized iron factory at Trece Martirez, Cavite. The Foundation for National Development alleged that Sonic Steel “failed to put up an environment monitoring fund (EMF) and create a multi-partite monitoring team to regularly check on the factory’s air, noise and wastewater emissions as required by the ECC.” Sonic Steel, however, denied these allegations (The Philippine Star, 06 February 2005).

With only one personnel assigned to monitor GSPI’s environmental management, truly a job for a specialized department with dedicated environmental engineers in 1999, additional staff should be hired to beef-up EMS monitoring.


Notes:

Mendoza, Edward L (2007), Essentials of Open Access and Retail Competition. Proceedings of the 12th Region VIII (Nothern Mindanao) Regional Conference. Elena Tower Inn, Iligan City: Institute of Integrated Electrical Engineers of the Philippines, Inc. 26-18 August 2007. back to text

China Watch (2003), Tariffs Boosting Steel May Have Short Life. China Watch Orbis Publications, 26 July 2003. back to text

Santos, Bayani Jr. (ed.) (1992), Steel isn’t just for things; It’s for people. NSC News, XVII: 8, Makati: Corporate Communications, NSC, 31 August 1992. pp. 8-15. back to text

NSC News (1992), National Steel Corporation: “Building a Country Together,” Eighteen Years of a Most Meaningful Commitment. NSC News Supplement. Makati: Corporate Communications, NSC, 23 October 1992. back to text

Cola, Doods (1993), Agenda 21: Survival in the Next Century. NSC News, XVIII: 6, Makati: Corporate Communications, NSC, 30 June, 1993. p. 11-14. back to text

The Philippine Star (2005), “Advocacy group seeks closure of steel plant,” Manila: The Philippines Star, 06 February 2006. back to text

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