With the arrival of the spring, however, fine dust is sweeping across the country, and the public thirst for refreshing air is stronger than ever. At such a period, POSCO’s approach to creating a humble forest inside their steelworks is worth noting.

A forest inside steel mills? The connection between the two isn’t apparent, but POSCO is going above and beyond to maintain and expand the green space within their steel mills. Why?

Pohang Steelworks stands over old landfills near a seashore – not an ideal space for planting or growing trees. This challenging circumstance, however, didn’t stop POSCO from establishing a Green Zone outside the Steelworks from the early days of its establishment, and the company’s careful management of the area continues to this day.

Up until last year, Pohang Steelworks invested 44.2 billion KRW (approx. 39.9 million USD) for its afforestation project – Gwangyang Steelworks spent 28.3 billion KRW (approx. 24.87 million USD) for the same task. Through massive investment, systematic planning, and persistent management, POSCO transformed the area – first by building the steel mill in no man’s land; then by surrounding the mill with trees. Lots of trees. Now their steel mills, both Gwangyang and Pohang Steelworks, stand in the middle of forests.

l 350 Central Parks Inside POSCO Steelworks?

Walking around Pohang and Gwangyang Steelworks, one cannot miss the numerous evergreen trees with broad leaves. That’s because tree leaves could cause malfunctions for the steelworks facilities – with broad leaves, such occurrence is less likely.

Both in and out of the steelworks, it’s obvious the company thought through various ecological details. For areas prone to arsenic acid dust, the trees were cascaded over to shield off the dust. When designing landscapes, the team also looked into the underground piping system to make sure the pipelines do not interfere with the trees’ pathways.

POSCO spared no costs to green their mills – their meticulous afforestation effort was subsequently followed by equally, if not more, meticulous management. Their effort bore fruit in the form of hiked greenspace ratio. Now, the greenspace at Pohang Steelworks is about 2.2 million square meters, which is 24% of the mill’s total space of 9.5 million square meters. The greenery at Gwangyang Steelworks, twice the size of Pohang Steelworks, occupies 22% of its total space. Gwangyang Steelworks shares 4.69 million square meters of space with trees and forests out of its entire surface area of 21.35 million square meters.

With 1.93 million trees planted and growing at Pohang Steelworks and with over 5 million at Gwangyang, altogether 7 million trees are growing in both steelworks combined. To put that in context, the Central Park in New York City has about 20,000 trees. With 7 million trees, it’s as if Pohang and Gwangyang Steelworks are holding 350 Central Parks inside the mills.

POSCO’s afforestation project for their steelworks did not happen overnight, and it keeps on growing.

l 10 Times Bigger than Seoul World Cup Park

So the greenspaces at Pohang and Gwangyang are 2.2 million and 4.69 million square meters, respectively. These numbers alone don’t give us a palpable enough picture. How big are they exactly?

Using Seoul World Cup Park as a base point might be helpful. The Seoul World Cup Park is about 210, 000 square meters, which means, at 2.2 million, the greenspace at Pohang Steelworks is about ten times bigger – and Gwangyang, at 4.69 million, over 22 times.

Such vast spaces require careful management. At Pohang Steelworks, Administration & Public Relations Group is in charge of the space management, together with POSCO’s partner, DongWon. From DongWon alone, over 30 workforces are committed to managing 1.93 million trees planted across the 2.2 million-square-meter space. The employees are busy pruning, trimming and getting insect pests under control. Keeping the trees clean and washed is also part of their job. Nearly five trucks are mobilized to perform the task.

Dae-Hyung Lee, the Manager of Administration & Public Relations Group at Pohang Steelworks, says: “The workload can be enormous but invisible, which is why it gives us tremendous joy when people send us thank-you notes, no matter how big or small.

Dae-Sun Kim, DongWon Manager, also said: “It’s gratifying to notice the improvements at the steel mills and to know, what we do matters.” Lots of employees spend time in the parks managed by these ‘gardeners’ of the little forest surrounding the steel mills.

National Arbor Day or not, POSCO’s endeavor to keep the mills green never stops – POSCO’s effort to plant over 30,000 trees every year rewards both its employees and the community in the form of more green spaces.

Not everyone can plant trees, but everyone can take a moment to pay gratitude to the values the trees give us. Let’s plant that seed of gratitude in our heart.

Huayou Cobalt is one of the world’s biggest mining companies that can produce about 50 percent of the cobalt required for manufacturing lithium-ion batteries worldwide. They also have their own nickel mine in addition to a cobalt mine.

The joint venture for precursor production is made up of 60 percent of investments by Huayou Cobalt that can supply cobalt, nickel and manganese, and 40 percent by POSCO. 60 percent of investments for the joint venture for cathode material production comes from POSCO who owns the high-grade cathode material production technology and 40 percent of investments come from Huayou Cobalt. The joint ventures will be operating production lines for 4,600 tons of precursors and cathode materials a year starting from the second half of 2020.

POSCO and Huayou Cobalt sign agreements for joint ventures in cathode material supply and production.

Through these joint ventures, POSCO can now secure its market position in China by directly manufacturing and selling cathode materials locally. In addition, it can gain a competitive edge by securing a stable supply of not only precursors but also materials such as cobalt, nickel and manganese for POSCO ESM’s cathode materials plant in Gumi. Huayou Cobalt can expand its business in manufacturing and sales of cathode materials in addition to that of raw materials.

As the eco-friendly policies of the world continue to be tightened, the demand for electric vehicles, industrial energy storage systems (ESS) and IT bulk batteries has increased rapidly. Thus, the market for cathode materials, which are essential materials for lithium-ion batteries, is also expected to quadruple from 210,000 tons in 2016 to 860,000 tons in 2020.

Accordingly, the price of cobalt, one of the most expensive materials, tripled in the last two years, followed by the price of nickel and manganese. This explains why a stable supply of materials is essential for profitability.

POSCO’s lithium-ion battery material business is headed for future growth, and is expected to gain increased momentum with the joint ventures for precursors and cathode materials. POSCO completed its carbon lithium plant PosLX at Gwangyang Steelworks last year after 7 years of developing its own proprietary technology of directly extracting lithium in 2010. It is currently under commercial production.

What’s more, manufacturing is no longer a rigid industry that produces uniform, one-sided goods. There is constant communication between customers and businesses for hyper-customization. Not only that, machines and products communicate within a smart factory, and factories exchange data with other factories. Manufacturing is no longer limited to production plants. Moreover, the data generated in the manufacturing process is combined with customer information, and a new service can be created. This combination of manufacturing and services is resulting in creation of added value. In the midst of such drastic change, how can companies stay competitive?

Staying Competitive Through Connection and Convergence

Global manufacturing companies are at the forefront of the 4th Industrial Revolution, as evident in their smart factories. A smart factory collects data generated from the production process using ICT technology, and the system controls all processes from material input to the final product. This has led to flexible production systems with the ability to make various products in one factory or to expand the range of products on the basis of connectivity. Typically, when a company builds a smart factory, it can improve productivity by 20 to 30 percent. A 20 percent improvement in efficiency in the manufacturing sector is a significant, outright increase in global competitiveness.

SEE ALSO: How Smart Factories are Changing the Manufacturing Industry

Siemens Electronics Manufacturing Plant incorporates robotics, AI and IoT to its production processes. (Source: Zawya)

If the productivity of a plant can be improved through smartization, it is important to also think about connectivity with the ecosystem that exists outside of the plant. Once a smart factory is built, all the data from customer orders to production and delivery are collected in a system via sensors. The customer, product and production data create meaningful connections with each other and provide extensive insight. Examples of added value creation through meaningful connections include hyper-customized goods, data-driven after-sales services to customers and collaboration among companies connected within the smart factory’s external ecosystem. Such advancements will lead greater product quality, production stability as well as shortened delivery times between value chain suppliers.

The Adidas Speed Factory and GE Brilliant Factory are examples of successful smart factories. Adidas customers choose the materials, colors and design of their sneakers, and have them manufactured and shipped within 24 hours in an automated factory.

GE has built a system that can produce all of their widely-diverse products in one factory. When the factory receives customer orders, it operates in a flexible production system which starts with the necessary raw materials, inputted by the automated scheduling system that controls the entire production process, including the final distribution system.

The Future of Manufacturing

Overall, the adoption of innovative changes in the manufacturing sector is likely to progress from lighter industries to the heavy industries, from B2C to B2B sectors. Small plants, quick manufacturing and B2C companies can more readily adapt to rapid technological and market changes. On the other hand, heavy industries like steel and B2B companies with continuous and heavy manufacturing, large production volume and numerous linked companies are likely to be slower to adapt to changes.

It is much more difficult for traditional, heavy industries to adapt to changes. (Source: Live Mint)

For example, adapting to the changes of the 4th Industrial Revolution in the steel industry may be slow, but it is inevitable. What’s more, the long-term adaptation process is more likely to be systematic and deliberate.

As a leading company in the global steel industry, POSCO is pursuing a long-term, systematic “Grand Design” to reinvent its systems to align with the changes of the 4th Industrial Revolution.

First, POSCO built a pilot smart factory in their steel mill, Gwangyang Steelworks, in 2015 that is currently in operation. The company used IoT to collect big data on site, analyze it in real time and build a smart factory that enables optimal control through AI and self-learning. As a result, the Gwangyang Steelworks is reaping the benefits of a smart factory not only in cost reduction but also in improved steel quality, minimized malfunctions and a safe and stable production environment. This year, POSCO plans to expand and apply smart factories to all of its production processes.

POSCO built a smart factory in Gwangyang Steel Mill.

Smart factory application throughout the entire steel mill will improve overall efficiency through a flexible production system. In addition, the factory will be able to respond directly to various customers in real time based on platform construction with customers within the connected ecosystem. The customized characteristics and design of the steel grade for each customer can be applied to production in real time.

SEE ALSO: How Factories Produce Steel – the Smart Way

Ultimately, a smart ecosystem that links manufacturing, processing and distribution with customer input will lead to a new, innovative ecosystem within the steel industry. In Europe, some companies are experimenting with material libraries and steel distribution platforms. The material library displays a variety of materials for customers to see, touch and test the workability and performance of the materials, and get information about the characteristics, design and delivery times through the order platform. Customers can designate the shipment date on the spot. This will be one of the new promising business models that steel and other material companies will strive towards in the coming future.

POSCO’s Grand Design includes a step-by-step approach to smart factories to expand the use of IoT, AI and Big Data in its production systems. To this end, POSCO ICT has developed PosFrame, a standard software platform that collects basic data of production processes and collectively manages, controls and analyzes the information.

POSCO uses its software platform, PosFrame, for data collection and analysis.

When the software becomes standardized and reliable enough to extend to other sectors, it will be applied to other business areas such as energy and construction, as well as to POSCO’s affiliates.

Manufacturers will have to take into account the heavy production environment, the slow industrial change cycle and the complexity of related industries and affiliates to implement the most effective, long-term, systematic upgrades to its production systems. This will result in a brand-new production and business model for manufacturing companies that will align with the new environment of the 4th Industrial Revolution.

Cover photo courtesy of Sputnik International.

At POSCO, there are many talented researchers, engineers, and factory workers, who are working constantly to make steel stronger, lighter, and longer-lasting. The Steel Wire sits down with three of those POSCO employees who have played essential roles in helping to establish POSCO as an industry leader in automotive steel solutions.

Q1. POSCO has relied on its experts to become an industry leader in advanced automotive steel manufacturing, and you have all played important roles within POSCO’s development of automotive steel. Can you tell us about the fields you are in and what your role has been?

[Shin Seung-cheol] For the last three decades, my main focus was to secure POSCO’s position as an industry leading automotive steel producer. Currently, I am at Gwangyang Steelworks working to create steel innovations and develop new technologies.
[Cho Byeong-ho] I work in the cold rolling department at Gwangyang Steelworks. Since joining POSCO in 1990, I have been working to develop World Premium Products, which account for 70% of the cold-rolled products manufactured in my department.
[Lee Jin-soo] I began my career at POSCO in 1993 working as a sales engineer in Indonesia and Singapore. After that, I moved to Gwangyang Steelworks where I was in charge of establishing technology strategies for automotive steel sheets as well as producing Tailor Welded Blanks (TWB). More recently, I guided the completion of Thailand CGL in 2016 to help POSCO be more competitive in the SE Asian market. Now, I serve as the corporate head of POSCO-Thailand Coated Steel (TCS).

“POSCO’s mission in 2009: Develop the best, most advanced automotive steel solutions that only POSCO can produce.”

Q2. Starting is often the most difficult step and we have sure faced some hurdles along the way. Can you tell us about the some of the problems you faced while developing automotive steel products?

[Shin Seung-cheol] Sure, in 2009, our team’s goal in the rolling sector was to ensure the productivity and quality of the World Premium Products. In the annealing process of the cold rolling sector of the Gwangyang Steelworks, I was told to make “the best automotive steel plates.” However, compared to other products, automotive steel plates demand a much higher quality than other products, and our equipment was outdated and rundown, making it almost impossible to create the flawless steel plates that were required. Achieving both high quality and continuous mass production required a new level of innovation.

[Cho Byeong-ho] When I was at the cold rolling mill, we were facing challenges from both domestic and foreign competitors. So, we streamlined old equipment and increased production of the World Premium Products such as automobile steel plates and high-grade steel. However, there were many problems. At one point, the cold rolled steel kept falling off before reaching the rolling process.

Q3. There’s a famous quote that says ‘Patience is bitter, but its fruit is sweet.’ Does this make sense when you think about the work you accomplished in developing advanced automotive steel for POSCO?

[Shin Seung-cheol] Yes, that quote rings true for our team. After three years of testing the steel surface quality and improving the Continuous Annealing Line (CAL) facility, we eventually succeeded in securing high-quality automotive steel plates. Strict management standards along with systematic & rigorous product inspections from the customer’s point of view were also put in place in order to ensure that the products met the client’s needs.

[Cho Byeong-ho] When we couldn’t keep the steel from falling off before reaching the rolling process, we decided to visit the cold-rolling mill at Pohang Steelworks to help us find a solution. There, we worked on solving the problems with a small-scale laser welding team and we got support from maintenance experts. With proper facility training and data improvements, the 2nd cold rolling mill was ultimately able to work consistently.

“Now, it’s more than a mission. We will be the leading automotive steelmaker in Asia.”

[Lee Jin-soo] Thanks to our team’s endless efforts, POSCO was able to succeed in producing highly competitive automotive steel. POSCO provides around 150,000 – 200,000 tons of galvanized steel plates to Thailand every year. But we did not want to be #1 only in Korea; we wanted to have a stronger presence in the growing Thai market as well.

In order to expand our presence in the Thai market and provide stable supplies to existing clients, we differentiated ourselves from competitors through the quality of GI products for home appliances and painting – areas where we held a competitive advantage.

Q4. Your passion for finding innovative solutions, as well as your success at POSCO, is impressive. What are some of the most meaningful accomplishments you have made at POSCO?  

[Shin Seung-cheol] I was very grateful to be named as one of the POSCO Masters of Korea in 2016. This honor is reserved not only for the best field technicians with the highest levels of skill, but also for those who help their coworkers by sharing their expertise. I was happy to be acknowledged for my own skills as well as my efforts to help others.

[Lee Jin-soo] I am proud that I was able to be a part of the efforts to bring two manufacturing centers in Mexico online. POSCO-MPPC plant 1 & plant 2 were POSCO’s very first overseas construction sites and were very important for the future of POSCO’s global growth. And recently, getting the chance to guide Thailand CGL to its opening was very important for POSCO and very meaningful for me.

[Cho Byeong-ho] When I started, I believed that it would be really helpful to gain knowledge about each part of the steelmaking process. As a result, I taught myself about each step and acquired certificates in various fields including ‘Master of Craftsman Welding’ and ‘Master Craftsman of Rolling.’ This allowed me to do more specialized work for POSCO and for its automotive steel solutions.

Q5. Lastly, please share with us your vision moving forward.

[Shin Seung-cheol] While I’m somewhat confident in my operational skills after 34 years on the job, I still want to study more. I want to learn more about engineering theory and process development. My dream is to become the best possible technician I can be.

[Cho Byeong-ho] Moving forward, I want to continue the work to boost our equipment capacity while also improving our technology so that we can continue to produce the best World Premium Products.

[Lee Jin-soo] At Thailand CGL, we want to move forward to provide manufacturing technologies, such as mold technology and automotive steel sheet buying channels, to small local companies. This will allow POSCO to expand its contract base into a solution marketing system.

The advancements made in POSCO’s advanced automotive steel are driven by people like Shin Seung-chel, Cho Byeong-ho, and Lee Jin-soo. Without their determination, intelligence, and innovative thinking, POSCO could not be where it is today.

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For Master Shin, his success at POSCO over the past 34 years comes down to giving credit to his juniors, honoring his superiors and taking responsibility for his own actions. “I think the company is one group sharing a common destiny,” he says. “If you are in a position to lead others, you should try much harder with a community spirit in mind and lead by example.”

The title POSCO Master of Korea is reserved for the very best field technicians, those who have the highest levels of skill, along with helping with coworkers by sharing their knowhow and helping to make POSCO into a worldwide leader.

In this last installment of the series looking at the POSCO Masters of Korea for 2016, we profile Master Seungcheol Shin, to see how pride and the drive to improve underlie his stellar career.

A Lifetime of Constantly Challenging Himself

Born in 1963 to a family of modest means in the Korean countryside, Shin was encouraged to study hard from a young age. He earned a scholarship to Pocheol Technical High School, a school owned and operated by POSCO, and one of the most prestigious schools in Korea. Located in the city of Pohang, Pocheol was far from Shin’s home, but his parents were overjoyed at the opportunity.

At Pocheol, he continued to study hard and do well, graduating among the top of all the kids in his class. While his good grades gave him the opportunity to go to university, his family’s tight money situation forced him to go to work instead. But Master Shin embraced life at POSCO and never looked back.

Today, Master Shin has the passion and voice of a younger man. Shin has been at POSCO for 34 years, but his coworkers all agree that he truly enjoys his job and still likes to challenge himself.

By his third year at POSCO, Master Shin was working for the electrolytic cleaning line (ECL), removing any rolling oil, iron fines or grease that remain on the surface of a cold-rolled plate. Back then, technology controls were much simpler, and operators had to use their eyes to check the quality of coil annealing.

During night shifts, the inspection job was even tougher, and sometimes workers would nod off—only to be awoken by the jarring sound of heavy steel coil falling and hitting the ground. “We would get scolded by our section chief and manager,” Shin says, smiling at the memory. “But that was part of learning the job and my growing process.”

Taking Automotive Steel to the Next Level

Shortly after the year 2000, the steel market started to change, as cheap steel from China starting appearing around the world. POSCO’s response was to change direction and instead concentrate on producing World Premium steel products.

The Gwangyang plant was considered the world’s best automotive steel sheet manufacturing facility, so in 2009 it was tasked with developing a new, specialized steel product that only POSCO could produce. But with the aging equipment in that plant, the order to innovate was quite a challenge. Nonetheless, everyone on the automotive steel division pressed ahead.

“In order for us to achieve the objective of mass producing both high quality and continuous products, we needed work that was innovative, not just improvements,” Master Shin says.

So the continuous annealing line (CAL) system needed to be remodeled, constantly monitoring the results for quality. At every step of the way, Shin and his coworkers encountered challenges and troubles, but gradually they made progress. Finally, in February 2011, they achieved the level of quality demanded by their client.

Through challenges like that one, Shin and his colleagues learned that improvements do not happen by accident. Lowering defect rates and improving quality require relentless efforts, as well as truly understanding the technology of steel.

By improving data collection and awareness, Shin was responsible for lowering the dent defect incidence rate to 0 percent, even using equipment that is 27 years old. And by maintaining preconditioning strip whiteness index at over 90 percent and boosting the cleanliness of the furnace, he was able to prevent the insulator from being damaged even if the strip is bent or broken in the annealing furnace.

The Importance of Humility and Hard Work

Despite decades of leading impressive improvements to the automotive steel division, Master Shin is still driven to improve himself. “While I’m somewhat confident of my operational skills, I still want to study more,” he says. “I want to gain more engineering theory, including about process development, design and more. And I want to acquire my Professional Engineer Metal Materials certificate soon.”

He adds: “My dream is to become the best possible technician, with 34 years of operational experience, engineering theory, and an engineering certificate.”

If there is a core common theme that can be found among the three POSCO Masters of Korea for 2016, it is probably “humility.” For Chajin Kim of the blast furnace team and Sungnam Kim of the electrical installation team, just like Master Shin, they all recognize the importance of always pushing their limits and improving.

“You need to never stop training, never stop practicing,” says Master Shin. “We all need to have the attitude of continuously desiring to get better, practicing and challenging ourselves.”

For POSCO, we are proud of our three latest Masters, and think their knowledge and dedication represents the true spirit of our company.

Meet the Newest POSCO Masters of Korea

‘The Equipment Never Lies’: POSCO Master of Korea Chajin Kim

Always Remembering the Big Picture: POSCO Master of Korea Sungnam Kim

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The company has created content that provide the experience of steel product manufacturing at its steelworks using virtual reality (VR), which has been increasingly growing in popularity as of late. Customers can now look around the manufacturing site of the steelworks without actually having to be onsite. This made it possible for viewers to experience the production process anywhere and at any time, simply by wearing a mobile device with a head-mounted display (HMD).

POSCO employees wearing HMDs to virtually experiencing the steel product manufacturing process at the company’s steelworks.

POSCO filmed a 360-degree visualization of the entire steel manufacturing process, from loading and unloading raw materials to shipping the products, so that the viewers can feel as if they are actually visiting the steelworks. Moreover, POSCO also paid a great deal of attention to details in the experience that were likely to be overlooked, such as the elaborate sounds of the machines. By wearing an HMD and moving their faces left and right, people can now conveniently look around the ironmaking and steelmaking factories that had been off-limits due to safety issues.

To provide a sense of reality in its VR content, POSCO utilized various equipment such as drones and overhead cranes for filming. This image shows workers filming a 360-degree view of the ironmaking plant at Gwangyang Steelworks.

To create the VR content, POSCO adopted a filming technique using drones and overhead cranes. Subtitles and narration were inserted in each scene to make it easier for users to understand the steelmaking process. The company also produced an English version to for overseas clients who were facing difficulties when visiting the site. As such, POSCO will actively use the VR content to widely promote its strong competency onsite. The content will also showcase the company’s outstanding product competitiveness, seen through offering state-of-the-art promotional services for clients with rising expectations.

POSCO will showcase its steelworks VR content at the Steel & Metal Korea (SMK) 2016 that will be held in KINTEX, Ilsan from September 27 to 30. The company plans to actively utilize VR in other domestic and overseas exhibitions, as well as visits to clients in order to support marketing and PR activities.

VR (Virtual Reality) is a form of user interface technology that provides a virtual experience that seems like reality and uses human senses such as vision and hearing inside a computer software program. While augmented reality (AR) overlays a virtual world on top of a real world, VR forms a virtual world by mainly using computer graphics. Users wear an HMD (head-mounted display) device on their heads. VR is used in diverse ways for the publicity of products and for safety measures through indirect experiences in the manufacturing business.

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Having been certified in such fields as electrical engineering, firefighting equipment and engineering, Master Kim’s expertise is both broad and deep. That experience and technical know-how, along with his tireless dedication to mentoring the other members of the electrical maintenance team, were what led to Kim being named one of this year’s three new POSCO Masters of Korea.

The title POSCO Master of Korea is reserved for the best of the best field technicians, those with not only incredible skills, but who also lead their co-workers by example and help contribute to the competitiveness of the company.

Let’s take a look at Master Sungnam Kim, and how four decades of dedication have made him a legend on the electrical maintenance team.

Dreaming of POSCO While Still in School

Sungnam Kim had grown fascinated with POSCO, even before he finished high school. Having grown up in a 12-person family in a small home, he was always a tinkerer, often taking apart radios or other electronic devices. With such a large family, he had to go to a vocational high school, where he first learned about electronics and machinery, and thanks to his inquisitive nature he excelled in his studies.

Back in the 1970s in Korea, there was a popular TV series titled Blooming Corners of Korea, which featured the wife of a POSCO employee who played a significant character. The drama even had scenes that were filmed in front of POSCO’s main gate. Because of that, Kim says he grew more aware of POSCO and began thinking about one day working there. More importantly, with his interest in electricity and machines, he thought the company made a great fit.

His dreams soon came true. On January 20, 1978, he started work at POSCO, just two days after graduating high school. At first he found the transition very difficult. Even though he had studied mechanical and electrical subjects in high school, the real-world field conditions at POSCO were very challenging.

POSCO was a very different company back then, just starting its dramatic growth into one of the world’s leading steel companies, and working conditions could be difficult. However, Kim was fortunate to work under Huicheol Choi, the manager of equipment repairs and a legendary mentor from that period. Choi would teach workers mathematics in the mornings, as well as electrical engineering and practical subjects.

“I remember that first day, he took out his electrical engineering book, and in his thick southern accent he said ‘I still study every day. I want you to study every day’,” Kim recalls. He says he took that advice to heart and vowed to always keep learning.

Learning Through Adversity

Sometimes learning came from terrible circumstances. In December 1980, POSCO suffered an infamous accident in one of its old ironworks. There was a major fire, but Kim discovered that his team was unprepared to deal with it properly. It took around-the-clock work for 20 days before the ironworks was able to restart.

“When the sooty, silent plant finally restarted, the noise of the equipment resuming operations was genuinely touching,” he says. “The sound of working equipment for a repair technician is the most pleasing sound there is.”

Following that accident, he grew obsessed with gaining field experience and real-world know-how. “I followed my seniors everywhere, learning all I could. Electrical fires, transformer damage, main motor breakdowns—I wanted to know everything,” he says. “I wanted experience solving all types of problems, big and small.”

Since then, safety has been a major concern for Master Kim, in particular preventative maintenance. Fixing broken equipment is important, but it is even more vital to ensure everything is working properly to avoid accidents and dangerous situations from beginning.

“I feel that POSCO’s maintenance and restoration processes are the best in the world,” Kim says. “Technicians should always feel a duty to give 100 percent, to ensure everything is well maintained.”

Awarded ‘Master’ in Recognition of a Lifetime of Service

Kim’s lifetime of dedication to safety and maintenance of electrical equipment at POSCO led to his being honored at a POSCO Master of Korea. In addition to his many technical certifications, Master Kim has also been awarded for seven outstanding proposals and three registered patents over the years, along with honors by the president and head of ironworks. In fact, his co-workers like to say, “Sungnam Kim exists wherever there is equipment.”

Throughout his interview, two words repeatedly came up: curiosity and passion. Even while a child, those were the traits that most defined him. And those are the traits that underlie the best of the best field technicians. Approaching his work with that vibrant spirit helps Master Kim stay young at heart.

Furthermore, for Master Kim, building knowledge isn’t just about learning. It is also about passing along that knowledge. “There’s a divide between the knowledge of someone with 20 years’ experience and someone with just one or two years. And advances in technology are not enough to bridge that divide.”

In the end, the goal is about more than just techniques and equipment. It’s about really knowing the entire operations, as thoroughly as a doctor understands the human body. “A technician should be a doctor for the equipment, listening carefully and regularly checking its status,” he says. “I want the next generation of engineers at POSCO to think past the details and look at the big picture, so they can all be true masters.”

After 38 years in electrical equipment maintenance, Sungnam Kim knows the big picture like few others. As a POSCO Master of Korea, we look forward to learning from him how to see that bigger picture, too.

Meet the Newest POSCO Masters of Korea

‘The Equipment Never Lies’: POSCO Master of Korea Chajin Kim

Never Afraid of Failure: POSCO Master of Korea Seungcheol Shin

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POSCO has recently announced that its high manganese steel, independently developed for the first time in the world, will be used in building the fuel tank of the LNG- LNG-powered bulk carrier. To be built by Hyundai Mipo Dockyard, a versatile Korean shipbuilding company, the LNG-powered bulk carrier will include high manganese steel supplies from POSCO beginning the third quarter of this year.

The largest cargo capacity of any existing LNG-powered bulk carrier has been 7,000 tons so far, but the new ship will be able to carry 50,000 tons of freight, which is about seven times more than its precedents. It will also feature an energy-efficient, eco-friendly dual fuel-capable engine that can run both bunker C oil and LNG. The ship will be completed by the end of next year to be used beginning 2018, and will carry limestone materials from Gangwon-do to Gwangyang Steelworks for POSCO.

POSCO’s High Manganese Steel has Better Performance and Price Competitiveness than Other Alloy Materials

Because POSCO’s high manganese steel contains about 20% manganese, it has the capability to store LNG, which requires to be kept at an extremely low temperature of -162℃. This high manganese steel-made LNG tank is superior to the currently existing nickel or aluminum alloy-made tanks in terms of yield strength, the minimum temperature it can hold, toughness and price.

Since the ship is designed to sail across the ocean, it will be built based on the IFG Code, an International Code of Safety for Ships using Gases or Other Low-flashpoint Fuels. It looks like the high manganese steel will be more likely to be chosen as a material that can handle extremely low temperatures by the International Maritime Organization once the ship sets sail.

POSCO plans to jointly build an overseas market for high manganese steel, with domestic shipbuilders like Daewoo Shipbuilding & Marine Engineering that have a mutually close cooperative relationship.

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However, safety cannot only be a top-down concern. To really be effective, safety also needs to be practiced and thought about by each individual—which is why POSCO has instituted a program called “SSS”, or “Self-directed Safety Spread”.

SSS Means Safety for All

Self-directed Safety Spread (SSS) activities refer to employees practicing POSCO’s safety activities on their own. Self-directed Safety Spread (SSS) launched in 2015 to take the company’s safety promotion to the next level. By continuing to emphasize safety, POSCO was able to reduce accidents by 50 percent in 2015 compared to the year before.

But to become “POSCO the Great,” the company is focused on becoming even safer—and that requires empowering all the employees to take ownership of safety and create a bottom-up culture of safety.

In January, Gwangyang also put safety front-and-center with the POSCO Family Safe SSS Festival, with everyone in the plant promising to strive for zero accidents. For the festival, 570 people, including POSCO President Ohjoon Kwon, attended, watching a special safety video, making a safety pledge and implementing self-directed safety activities.

“Everyone, including the Labor Union Council and all employees, must participate in Self-directed Safety Spread (SSS) activities and do their best to make safety POSCO’s culture,” said President Kwon. “Please help POSCO become POSCO the Great in the field of safety by continually increasing our safety capacity.”

The company also handed out safety awards in recognition of a great safety culture and safety activities to Pohang Wire Unit, Gwangyang Energy Unit, and POSCO ChemTec, along with outsourcing partners PNP and Fine.

A Tradition of Protecting Employees

On March 24, POSCO’s Gwangyang Steelworks held a POSCO Family Safety Pledge Competition, as 330 employees and executives gathered to re-pledge their dedication to following the 10 safety rules, executing “Tool Box Meetings” before each day’s work and carrying out Self-directed Safety Spread (SSS) activities.

“Putting an effort into small details keeps the workplace safe,” said Dongil Ahn, a manager at Gwangyang Steelworks. “It’s important that everyone works on realizing an accident-free steelworks, as if each and every one of us is responsible for safety in the company.”

Safety an Integral Part of POSCO the Great

CEO Kwon introduced the concept of “POSCO the Great” in 2014, shortly after taking the reins of the company. The idea was to create a vision for the future of POSCO that was ambitious and innovative, and that would inspire employees to become actively engaged in building that future.

Safety and Self-directed Safety Spread (SSS) activities have also been an important part of POSCO the Great. In 2015, it focused on establishing Self-directed Safety Spread (SSS) and developing a safety mindset. This year, POSCO the Great shifts emphasis to implementation, encouraging employees to make a safety mindset habitual and a part of their daily regimen.

Last year, it was zero injury. This year, it’s zero harm. Last year, people were called upon to root out hidden hazards in their workplace. This year, they are being asked to emphasize disaster management and emergency preparedness.

POSCO has long emphasized the importance of worker safety, in all phases of the company’s operations. Self-directed Safety Spread (SSS) activities are the latest in a long line of programs that have constantly improved safety. Classes, employee meetings, and company-wide programs to minimize risks and emphasize safety are all needed to reduce injuries to zero. Only by doing everything possible to eliminate workplace accidents can POSCO realize its goal of becoming “POSCO the Great.”

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China is rapidly catching up with Korea in major manufacturing sectors, including automobiles, steel, and smartphones and Japan’s price competitiveness has improved thanks to Abenomics and the weak yen. The Korean government and companies agree that manufacturing is in crisis. This is a serious concern because manufacturing still accounts for the lion’s share of Korea’s economy.

Korea’s Rapid Growth

After the share of manufacturing in Korea’s GDP surpassed 20 percent in the 1990s, it continued to rise to 29 percent in 2014. Korea has the largest share of manufacturing in GDP among OECD member countries, and the second largest share in the world after China.

Even more impressive is the manufacturing sector’s contribution to economic growth. It had reached 29.8 percent by the 1980s and rose steadily each year until it reached an average of 43.9 percent from 2010 to 2014. Given that its share of GDP is 29%, manufacturing’s contribution to economic growth is substantial and its effect on economic growth is high. In terms of operating profit margin by industry, manufacturing is 1.5 times higher than the service sector.

Korea’s Potential Crisis

Now, the all-important manufacturing sector is facing three major challenges. First, slow global economic growth is persisting, and oversupply in major manufacturing sectors is worsening. Korea highly depends on the global economy, with an export-to-GDP ratio of nearly 50%.

The second challenge is the fact that Korea is sandwiched between China and Japan. Bolstered by the weak yen, Japan’s export competitiveness has increased significantly, and China is rapidly catching up with Korea in terms of technology. In 2014, China had 1,431 export items that were global best-sellers, while Korea had only 63 such items.

It’s evident that Korea’s manufacturing competitiveness is on a downward slope and has been for some time. According to the U.S. Council on Competitiveness, Korea slipped to fifth place in manufacturing competitiveness in 2013, from third place in 2010, and is expected to slide to sixth place in 2018.

The third challenge for Korea is that its manufacturing sector has limited differentiation strategies and no new growth engines. The competitive industrial performance (CIP) index, released by the United Nations Industrial Development Organization, placed Korea eleven places higher than China in 2000, but only three places higher in 2011. As it stands now, Korea is only 1.9 years ahead of China in scientific and technological competitiveness.

Five Year Plan

In order to stimulate the manufacturing industry, Korea must first encourage a culture that values manufacturing, a creative workforce, and innovative technology that will lead the future of Korea’s manufacturing progress. These three elements are the basis of a manufacturing powerhouse.

To this end, the Korean government has announced the “Five-year plan for Development of Companies of Middle Standing (2015~2019)” with the aim of nurturing 5,000 medium sized enterprises and 100 hidden champions by 2019.

Next, Korea should nurture a creative workforce and make the most of its talent. As it stands, Korea’s human resource capability is low relative to the size of its economy. This is an important task for Korea because in the 21^st Century one person’s innovation is more important than any product or service. For instance, startups, such as Facebook and YouTube, employ more than 5 million people. To take the lead in creating innovative technology Korea must develop a system to find, nurture, and utilize creative talents.

The Fourth Industrial Revolution

Backed by a culture that values manufacturing, a creative workforce, and innovative technology, Korea should instigate a new manufacturing revolution. If Korea plays its cards right it will enter the fourth industrial revolution, which will open a new chapter in manufacturing.

The fourth industrial revolution will be led by intelligent factories that integrate traditional industries with ICT (Information and Communications Technology). These factories will be operated by a two-way communication system between production facilities and products built on a single platform to optimize all production processes.

Smartification is also rapidly gaining ground at industrial sites, such as POSCO’s smart plate factory at Gwangyang Steelworks. In order for Korea’s manufacturing to survive global competition and grow sustainably, it should strive for manufacturing innovation through smart factories, and add value to existing products and services.

Korea’s manufacturing sector may be facing a crisis, but it has the ability to come out on top. According to the report by Dr. Park, Korea boasts strong manufacturing competitiveness, prowess as an IT powerhouse, and world-class ICT infrastructure. With such advantages, Korea should actively embrace the future of manufacturing and implement innovation strategies tailored to its manufacturing.

Related Link:

In Southeast Asia, Surging Imports Lead to Rising Trade Barriers

China’s Era of New Normal and its Implications on the Steel Industry

The Evolution of the Steel Production Process

The Myth and Reality of Global Steel Overcapacity

POSRI Releases First Edition of Bi-Annual English Journal “Asian Steel Watch”

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