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New Zealand Engineering 1999 July Manufacturing
Steel Today - Work Force, Innovation and Business Performances To achieve excellence in production of products and steel-processing efficiency, it is necessary to invest more in the metallurgical competence of the work force. The emphasis should be placed on the steel manufacturing rather than on marketing, retailing and stocking. Developing knowledge and expertise related to the achievement of superior steel manufacturing technology implies needed improvements in the infrastructure of the whole steel-making business. Some of the problems impeding such improvement lie in insufficient technical/metallurgical education of the otherwise well trained operators. Likewise, new technical personnel hired to implement computer control systems (which have to "revolutionise" the operator’s role) for steel manufacturing are usually not trained and educated in process development and analysis. Computer control systems may be a sophisticated means of process control but still remain only one of control modules and, therefore, people adaptable to data changes and after development are much sought. With fast development in the steel industry, the premium on people knowledge grows ever higher. It is of critical importance to prioritise technological innovations in terms of both individual and team contributions for enabling continuous development of a steel company. In that respect, operators have an important role to put their structural knowledge and their factual knowledge at the best use within the company. "Knowledge about knowledge", also known as "meta-knowledge", is what allows operators to assume the appropriate operational procedures and provide a justification or explanation for them. The operators’ participation in team-working is vital for existing technology improvements. Expanding existing knowledge and risk-taking in innovation on the part of other technical staff (ie. metallurgist, maintenance engineers) is rewarding for the overall corporate culture. High turnover in any organisation has its costs and consequences, one of which, most importantly, is a loss of knowledge. With this fact in mind, it is new knowledge that finds no solid base to build upon. Procedural knowledge quite commonly arises and establishes empirically which may not be the case with new knowledge. Education of the work force, therefore, does not level with the training and is equally important if not vital. When new knowledge or novel "tricks of the trade" complement or eliminate the obsolete, the symbiotic influence of TMS (Trial Management System) and TE (Template) becomes vital. For example, in the case of continuous casting and finishing hot rolling (the two most challenging steel manufacturing technologies) the fundamental and heuristic knowledge have to be presented in TEs in the manner easily understood by operators and manageable by TMS. Correct and complete implementation of good steel production requires systematic analysis and thereby an accurate evaluation of problems involved. Some of the factors creating problems that are not easily detectable and hence complex in nature are: (a) time and schedule constraints; (b) contractual and budgeting matters; (c) the cost-cutting practice; (d) purchasing practice; and (e) role of management (people, biases, politics and personality). Even the most enlightened conception of a company’s management cannot work without good communication and the full contribution of its employees. Good leadership will get what it wants by helping others to get what they want. To implement a new idea often means fear for people with set in-group thinking. In the new industrial technology era, where knowledge controls advancements and access to opportunities, interdependence replaces independence. Therefore, a high-tech and "in-touch" steel company is led by a modern collective management characterised by transformational rather than transactional leadership. In other words, a high-performing management has high-performing technical support and vice versa. This relationship is based on the mutual responsibility (duties and rights) of the management staff, metallurgists and other supporting technical staff. The management’s trust in the capabilities of metallurgists, operators and other technical personnel to assess the value of intended technical innovations and implement them successfully is crucial. Not less important is the way in which technical staff and operators communicate with each other and trust each other. The steel market is cyclic and will remain so in the future. Up to the mid-1990s, the period between the peaks of production was approximately seven years. It is believed that in future this cycle will last no longer than three years1. The difference between the peaks and the troughs in price is also likely to reduce (see the chart). A paradoxical paradigm says: "The company must think like a high-tech research firm but must act like a high-touch service firm". For some time now, the steel market has been a buyer’s rather than a seller’s market. The concept of "selling what we make" is quickly converted to "make what we can sell". A flexible mini-mill (Fletcher Challenge Steel Makers and BHP NZ Steel Ltd belong to this class) is capable of meeting the ever-demanding requirements of customers for product diversification and quality improvements. Such small companies must rely on their expertise and competencies to operate successfully in certain market segments, where they (can) provide niche products. For the global market environment only one thing seems certain: the steel market will continue to seek seemingly contradictory things of the steel industry - to deliver higher quality products at lower cost. It is an often forgotten but golden rule - "take care of your customers and take care of your people, and the market will take care of you". It could solve all marketing problems. Click here to see a graph displaying the Average EU transaction prices DM per tonne. In an era of expanding markets and constant growth, the time when it was difficult to lose money in the steel industry has passed. Increasing constraints over environmental issues such as the minimisation of emissions and effluent, the recovery and recycling of spent products, and the effective utilisation of material, technical and human resources will continue to affect profit in the steel industry. In the past few years many steel mills abandoned their policy of selling cheap, low-grade products. Well chosen investment in continuous casting, ladle metallurgy and rolling mill upgrades have ensured substantial quality improvement and product gains. Reduction and swift globalisation of the steel market in New Zealand are the biggest "enemies" of the domestic steel industry. However, for the wiser and more enduring, it is a good chance to learn how only a better quality product, improved efficiency, and new-added value from production of more expensive grades of steel, can be instrumental for survival and making an extra profit. By selling the product, a steel company has to try to sell solutions by developing new products that suit customers better.
Borislav Dacic References
1. Fisher P.M., Metal Bulletin, Vol.27
(1998), pp.17-23. |
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