POSCO-America TSC (Technical Service Center) is strengthening its technical services and solution-based marketing support for its US and Mexican clients. The company opened last year with two offices in Mexico City, the capital and largest city in Mexico; and Birmingham, Alabama. Past January, it opened one more place of business in Houston, Texas. Based in these three cities, POSCO-America TSC is engaging in technical services and EVI (Early Vendor Involvement) activities for its clients in North and Central America, in which automotive and energy steel products are in high demand. Mexico is a global automotive industry hub. World’s top-notch automakers such as Nissan, GM and Volkswagen have active business operations in the country.

POSCO-America TSC Mexico City is currently focusing on automotive industry, providing technical services while working hard to develop new clients. It is also pursuing a certificate in automotive steel products. In an effort to increase the sales of steel products produced by POSCO and its local sales unit, POSCO-Mexico, the company is exchanging information with local processing centers and distribution corporations. POSCO-America TSC is scheduled to open a new business operation in Detroit, Michigan, within this year. Many global automobile manufacturers have headquarters and R&D centers in the city. Once it is opened, the Detroit office will dedicate itself to providing technical services for car companies in North America, as POSCO-America TSC Birmingham does.

Houston along with Scotland’s Aberdeen are two of the global energy industry hubs.  Located in Houston are companies from various sectors of the energy industry, such as Exxon Mobil, Shell, EPC (Engineering, Procurement & Construction) corporations and equipment fabricators. For this reason, POSCO-America TSC Houston is striving to get information about new business opportunities, by engaging closely with its key clients. As a result of all these efforts, POSCO-America TSC successfully signed a contract to supply GI (galvanized steel) products to a major US truck maker. Upon hearing that the GI materials the truck maker had been supplied were often flawed, POSCO-America TSC proposed a solution, in an effort to win trust from the company (and it worked perfectly!). The employees of POSCO-America TSC Mexico City demonstrate a high level of satisfaction with their everyday lives, due much to mild climate and friendly locals.

In addition, they take a great pride in representing POSCO’s automotive and energy steel business in the country with great growth potential. Living up to the motto, ‘POSCO the Great’, all the employees of POSCO-America TSC will enhance its efforts to provide its clients with upgraded technical services and solution-based marketing support. In addition to pursuing a certificate in automotive steel products, POSCO-America TSC will seek to strengthen partnership with key clients through more frequent contact with them. The company also plans to form a consultative group with local manufacturers, to improve the quality of its products.

On behalf of POSCO, I am delighted to be able to welcome the New Year with Daewoo International, POSCO E&C, POSCO Energy, POSCO CHEMTECH, POSCO ICT, as well as all the overseas staff from around the world, including China, Japan, Indonesia, Vietnam, India, and Mexico.  I wish you all a very Happy New Year! My POSCO Family!

My POSCO Family!

Last year, “MV POSCO” risked capsizing under torrential trading conditions, with the decline in profitability and stock price, the downgrade in our credit rating, and the sluggish performance of several investment projects. But, 2014 also marked a momentous year in which we embarked on our ambitious journey to become “POSCO the Great”.

In order to achieve this, we have been implementing an all-out transformation. We have made innovation an integral part of our operations by focusing on four strategic agendas: the enhancement of core competitiveness in steel, a thorough review and critical selection of new growth businesses, dramatic improvements in our financial structure, and reforms to our management infrastructure.

As we commence the New Year, I would like to express my utmost gratitude to all members of the POSCO family for supporting the company’s innovation agenda and implementing the reforms.

Through your tireless efforts and contributions, we have been able to complete the first phase of our midterm management objectives without any major issues.

I would like to take this opportunity to especially thank the employees at Indonesia Krakatau-POSCO, POSCO, and Daewoo International for their immense contribution to reaching this target.

Dear my POSCO Family!

Looking back on 2014, I would like to emphasize not only our achievement in reaching our management goals financially and quantitatively, but also the way we demonstrated the operational versatility to improvise our strategic direction, adapt to the constantly shifting industry environment, and collectively overcome the obstacles that stood before us.

As I look back, I am fearless about the challenges that lay ahead for our organization as I know that together we stand strong, determined and ready to respond with conviction

My members of the POSCO Family!

As we stand at the start of 2015, the business environment offers few signs of improvement.

Although the global economy is forecast to improve slightly with the recovery in the United States, any significant breakthrough is likely to be hindered by stagnant domestic demand, the slowdown in China, and the relative appreciation of the Won against the Yen.

Global steel demand is at a standstill, with declining prices resulting in a tighter squeeze in margins. For our subsidiaries, competition and business conditions are expected to be onerous.

I cannot reiterate enough how 2015 ought to be the Year of Perseverance to realize increased profitability and improved competitiveness.The critical phrase that I would like you to focus on as we usher in the New Year is “financial result generation.”

As we begin the second year of the Three-year Midterm Plan, it is vitally important that we demonstrate our executive ability for the key business agenda and move closer to our goal of genuinely actualizing favorable financial results.

My adored POSCO Family!

Let me share with you the five factors that will help guide us in the progressive direction of accomplishing the desired midterm financial results.

First, we must strengthen our revenue structure by providing solutions.

We have accelerated our premium product strategy in recent years by integrating technology, sales and solution marketing. This strategy was identified after due consideration as being the best way to ensure our longevity in this fiercely competitive business environment.

In the New Year, we must demonstrate progressive solution marketing by focusing on the development of World Premium products. We must expand the infrastructure of our global solutions to promote effective commercial support by TSC and other members of our solutions network. In the case of our family companies that engage predominantly in contract-based businesses, we have to mobilize our group’s capabilities and reinforce our solutions business in order to secure first-mover advantage by proposing and developing customized client-centric projects.

The second guiding factor is the acceleration of the ongoing organizational restructuring and the stabilization of our balance sheet.

Last year, we established the master plan for our group-wide restructuring and moved forward with the overhaul of our non-core operations. However, there is still a long way to go. This year, we plan to leave no stone unturned on our search to swiftly reorganize and fundamentally reinvigorate operations that are unprofitable. We must also internally minimize waste by reducing our inventory and working capital while still effectively managing our investments and any other assets that we may have neglected in the past.

Third, POSCO will advocate the proliferation and establishment of a project-based working approach.

This project-based working method is a tactic designed to explore potential projects that can deliver exceptional results and increased profitability with the short-term support of operational resources. Most importantly, the project-based system allows us to achieve quantitative financial performance. Projects that contribute to the realization of financial results will be recognized and adequately compensated. By focusing on discovering lucrative projects and producing tangible results in 2015, I look forward to the ability of project-based working to institute itself as a powerful tool in generating profits and creating a win-win scenario for both company and employees.

The fourth guiding factor is the need to realize the commercialization of our potential growth businesses.  

When I became CEO last March, I suggested that our sustainable future as a business lay in fostering a thorough review and critical selection of new growth businesses. As part of this review and selection of new growth businesses, we must incorporate our competitive technological advantages.  We must call for the advancement of lithium extraction technology in Argentina and nickel refining technology in Pohang to reach the commercialization phase. In addition to improving the performance of our fuel cell systems used in buildings for commercialization, we also need to stabilize our Gwangyang SNG plant’s processing operations in its stages following construction.

The fifth guiding factor is the need to expedite the fortification and augmentation of our group’s operational efficiencies and synergies.

The previous year saw the inauguration of the Value Management Department, which serves as the group’s corporate center, and the selection of key performance indicators for POSCO group’s reinforced goals centered on EVA (economic value-added). This year should be defined by the collaboration we achieve between our family companies specializing in their respective industries for greater operating efficiency, value creation, and synergy formation. We will also continue to expand the coordination and cooperation of overseas businesses by operating several regional headquarters.

My cherished POSCO Family!

I would like to respectfully insist that you maintain your alignment to the group’s strategic direction mentioned above in order that we accomplish the group’s management objectives.  I cannot stress enough that now is the time to propel our operations at full tilt.

Today, “MV POSCO” is no longer fit for purpose: the way of the lone battleship is no more. The role of our subsidiaries and overseas enterprises has become critical, as sales from these two groups account for over half of POSCO Group’s total revenue. These remote vessels of POSCO must assemble as an impregnable armada in order to realize our group-wide vision.  I urge you to give your full commitment to fulfilling this daunting task and exhibit superior competitiveness to reinvigorate our core competencies. That is how we will achieve our midterm goals and establish the foundation for the firm’s long-term prosperity.

My revered POSCO Family! Where do we stand and in which direction are we heading?

It is no exaggeration to state that “MV POSCO” has weathered one of the most calamitous storms since its foundation.

However, more important than the ability to endure is the capability to emerge triumphant. That is true victory.Despite the ominous predicament that stands in our way, let us unite and prevail undefeated to affirm our dignity and pride as part of the “POSCO Identity”.

I wish you all a victorious year in 2015. Once again, allow me to express my unconditional affection and appreciation for my admirable POSCO Family members.

On the first morning of 2015
CEO Ohjoon Kwon

[box] To greet the new year, CEO Ohjoon Kwon has recorded a special message. Please visit the website and take a look [/box]

“POSCO Stands beside Global Automakers” 

POSCO’s print advertisement introducing its global network of automotive materials has been released! As the advertisement demonstrates POSCO’s ‘world famous technology’ and the ‘best service based on its global network’, the series of ‘POSCO’s Global Network’ describes 15 production branches, 29 processing centers and 3 logistics branches. This advertising series were designed to visualize POSCO’s strength on customized sales strategy and customer service through logistics bases and technical service centers scattered all around the world. The design layout of a world map created with automotive steel parts is a notable feature of the advertisement. As we continue to advertise POSCO’s capabilities for premium products and diverse aspects as a prestigious steel company, we ask for your continuing interest!

Reinforced from the Past Advertisements 

With the purpose of better portrayal of the quality and technology of POSCO’s automotive steels, POSCO’s Steel Project Business Department has been producing print advertisement as a new attempt in order to inform the public about POSCO’s products and marketing.

Global Network and Technical Service Center (TSC) Enable High Quality Service

As shown in these print advertisements, POSCO has been contributing as a crucial role in the automotive flat products market. The current place of POSCO has been largely influenced by POSCO’s Technical Service Centers (TSC) established in 2011.

Distributed widely throughout the world, the TSCs handle local contact technology support. With technicians exclusively arranged for each country and location, they are in process of extensive technical exchanges with client companies. Associating with existing global network, they are fulfilling the demand and values of international client companies.

The very first global TSC was founded in China. Launched on October 13, 2011 in Tianhe District of Guangzhou, the center has been managing a number of duties that range from R&D of China-targeted product to customized service that reflects the demands of clients.

Reaching beyond to shipbuilding, home appliances, steel building materials, thick plates and more, POSCO will continue to expand its global network in every industry fields and advance along with clients through POSCO’s TSCs around the world.

Preemptive actions to client demands with steel industry know-how

With the know-hows gleaned from Korean steel industry, the foreign branches of POSCO had successfully stabilized the production process in their beginning stage abroad. Ever since their initial launch, they have been establishing their quality control system. As a result, they are now capable of providing preemptive responses to client demands, leading them to receive positive assessment.

POSCO-Mexico focuses on quality stabilization activities

Established to secure automobile companies in North America where automotive steel demand is increasing in a rapid pace, POSCO-Mexico has been concentrating on quality stabilization ever since its launch in November 2013. As POSCO-Mexico was successful in equalizing the quality of their products, they were able to further improve the efficiency in machining operations. Also, they were able to earn a positive reputation from North American automobile companies by actively providing the products and technology information that client are in need of.

POSCO Guangzhou branch enhances operation stability and production costs

Ever since their initial operation, POSCO Guangzhou branch has been putting their full effort on enhancing their automotive steel sheet quality, packaging layers and more. This endeavor brought improvements in operation stability and production costs. As POSCO Guangzhou branch continues to reinforce technology through dynamic collaboration with TSC staffs in China, they will contribute to further augmentation of POSCO’s global power.

US-UPI, successful management innovation through various improvement activities

UPI in the United States is an excellent example of successful innovative management achieved by all employees working together as a unity. With harmony between labor and management, the employees of UPI conducted a variety of improvement activities such as receiving external consulting for an effective restructure process. As they work on reinforcing their production efficiency, sales of high-quality steel and major reorganization, the current management structure of UPI is in the normalization process and such lucrative experience instilled a sense of pride to the UPI employees.

Krakatau POSCO‘s effort on management stabilization, POSCO-Maharashtra’s activities on production stabilization

In addition, due to the initial nature of the device industry, it is inevitable for Krakatau POSCO, POSCO-Maharashtra and some other branches to face deficits but it is expected that their management will be stabilized in short time. Actually, Krakatau POSCO has stabilized their production system as they reached the normal activity point in last May and they are now planning on expanding their sales structure until this upcoming December. POSCO-Maharashtra will also continue to engage in aggressive approaches toward their goal by the fourth quarter of this year.

Distinctive strategy with active client care activities

The foreign branches’ active client care is a distinctive strength of POSCO. POSCO has been establishing foreign branches and practicing consistent marketing strategies in the areas with steel industry growth potentials such as China, Southeast Asia and more. Not only stably providing products of excellent qualities, but also they have been emphasizing their differences by maintaining a total service system, including technology and logistics that clients ask for.

POSCO-CCPC’s sales manager, Tae-min Huh said, “As a sales manager, it feels most rewarding when I successfully make a new business relationships after constantly meeting local clients such as DFSK and convincing them to sign a new contract with us. Especially, when I hear from our client companies that our material supply and quality stability have improved further, I feel very satisfied. As our marketing strategy strictly focuses on the perspectives of the clients and listen to their stories with attention, we were able to create good relationships with the Chinese clients”.

Excellent global human resource is the driving force of POSCO

POSCO’s outstanding global human resource is another driving force of foreign branches that bring positive outcomes. In terms of overseas investment, POSCO commands a strict localization strategy.

POSCO provides professional training that includes leadership and organizational management to global employees those who are selected from each branch every year. Employees dispatched to the branches from the head quarter put extra efforts to learn the local culture and working method for effective processing. Also, as the foreign branches process their business under POSCO’s global standards, the foreign branches in various parts of the world maintains a global reputation for their work methods.

Tabata Yuki, who has been working as a sales director in POSCO-JEPC for five years, said, “At the beginning, I felt unfamiliar with the Korean working style and organization culture. However, by utilizing my given authority and abilities that I learned from the company, I believe that I was able to make an outcome in new client development despite of my relatively short career history”. Also, he added “In my opinion, POSCO’s differentiating factor with competing companies’ sales manager comes from actively sharing their global mindsets and knowledge through constant communication”.

Anish Aora, working in India POSCO-IDPC for seven years now said, “When I first joined the company, I faced a number of troubles processing the work due to the cultural differences between Korea and India. However, now I understand Korea and POSCO through constant communication with employees, career education and several visits to Korea”. Also, he added that POSCO’s good performances among the foreign factors are contributed by aggressive business mind toward their goal and standardized work process that applies equally in every foreign branch around the world.

Enhance relationship with the local community with Institution·Facility Support

Outstanding business performances by POSCO’s overseas subsidiaries stem from the formation of fond relationship with the local community. With their thriving business, POSCO’s overseas subsidiaries not only create new job opportunities, but also contribute to growth of local economy. Besides the economic boosts, POSCO has been actively supporting and constructing institutions and facilities in need to develop close relationship with the local community.

For example, China Qingdao Stainless Steel Co., Ltd., has been making generous contributions in the local community by supporting poor local families, nursing centers, scholarships and donations. In July 2014, the local news station extensively covered the company’s contributions. Similarly, POSCO was awarded grand prize in Korean Corporation CSR Award for its Ba Ria-Vung Tau Province Development Project.

POSCO’s overseas subsidiaries have resolved common difficulties in production, quality, and sales that often occur in the initial phase of the production and are currently being stabilized. These subsidiaries aim to promote win-win strategy for all parties involved and develop the local community.