Research On Competition Strategy Of Shougang Changzhi Iron&Steel Co. Ltd

Shougang Changzhi Iron&Steel Co. Ltd is a large-scaled Iron&Steel companywhose shares90%held by Shougang Group and10%held by State owned assetssupervision and Administration of Changzhi City. Its production capacity is3.6milliontons each year. Since2009, with the help of platform of Shougang Corporation, bigprogresses have been made in technology, equipments and techniques. Whereas withthe fast economic globalization, Iron&Steel companies depend on internationalmining monopoly excessively and international and domestic Iron&Steel market hasbecome white hot. Most of the domestic Iron&Steel companies have been in lowprofit era. Iron ore imports more and more and the Iron&Steel products capacity havebeen increased. The cost is rising but the profit is decreasing. Market competitivenessbecomes much weaker. All the above characteristics are obvious in Changgang. IfChanggang wants to survive and develop in the fierce global market competition,innovation in strategic adjustment and development pattern is imperative. Meanwhile,it is one of the primary tasks to emphasis on researching in enterprise strategy and tocultivate and enhance enterprise core competition.On the basis of theory of competitive strategy management, this paper putforwards the choice of competition strategy. Applying the PEST tools and Potter “fiveforce model” tools, it analyzes the macro environment faced by Changgang.Changgang has good opportunities in rapid development of Shanxi economy, supportsby Shougang Corporation and communication and help by other companies ofShougang, but Changang is facing many threats such as the severe competitionsituation in international market, national macro-control policies in Iron&Steel enterprises, high concentration of upstream and downstream industries and promotionof energy-saving technology. We know the company has obvious competitionadvantages in organizing management ability, quality of products, ability of gettingresource and Red Culture of enterprise after analyzing internal condition and factors inthe company. Those factors include organizing and management ability, financingability, marketing ability, producing ability and enterprise culture. But there are somedisadvantages restricting the development of enterprise, for example deficient fundsfor technology reformation, low-level technique equipments in old region, irreasonableproduct structure and instable iron ore supply. Thoroughly analyzing externalenvironment and internal factors and using SWTO matrix analysis, the paper comparesand analyzes the three competition strategies for the company. Combining the actualdevelopment of Changgang, scale low cost competitive strategy is selected. To reducethe cost, improve technique and equipment, promote developing ability of newproducts, Changgang can realize advanced technology, improve its own developmentstrategy and make it bigger and stronger combining diversification. Finally, the paperput forward pertinent measures in many aspects such as promoting low cost,optimizing human resource, strengthening management, implementing technologyresearch, carrying out special marketing, creating characteristic enterprise culture,raising funds, deepening informatization construction and implementing democraticevaluation and supervision.This paper studies the competitive strategy of ChangGang company in-depthanalysis, and based on this, advances the concrete strategic measures. Strive for thedevelopment of the company provide certain scientific basis for business decisions,and also hope to provide a reference to the peers value theory.