(July 8, 2002) The U.S. government has levied a tax on imported steel products to enable America’s steel industry to survive. The tax delivers relief to our industry and will provide the opportunity for companies that survive today’s wave of bankruptcies and consolidation to make profits and improve technology that will result in better and more economical operations. Our industry must take advantage of this opportunity and invest profits back into our plants to make America competitive when this tax is no longer in place.

The fact is America and its steel companies have enabled the current circumstances to develop. I believe that to understand the state of technology and the challenges America’s steel industry faces, as well as how to address them, it is helpful to know some history. After working directly in the steel industry for 35 years, I have some observations I’d like to share.

During the days of the Industrial Revolution and World War II, America’s steel industry was the world leader. Steelmakers in other nations looked to America for technological assistance. After WW II, as the rest of the world began to rebuild war-torn plants and break ground for new operations, America’s steel industry remained technologically stagnant, choosing to invest in other businesses. Unions, meanwhile, gained strength to the point where it became difficult to install new technologies that would reduce manpower requirements.

All of this contributed to our steel industry slipping toward obsolescence.

Foreign reliance

Then, in the 1960s as American companies began to build some new facilities, most bought equipment designed and built offshore because U.S. technology was not developed or proven to meet the new requirements. The steel industry would not provide American suppliers the opportunity to bid on the work unless they had licensed foreign technology.

The result was many U.S. equipment makers went out of business and our industry came to rely on foreign technology. We lost our American Spirit. We decided it is easier and safer to be followers than leaders.

It is clear today that America’s steel companies must become more efficient. We can only accomplish this by improving operations through better technology and maintenance practices to reduce downtime and improve productivity. So how do we do that?

Proper training

One step is to ensure operations and maintenance personnel are thoroughly trained when new technologies are introduced. Steel companies’ operations and maintenance employees must be involved from the very beginning when new technologies are introduced if we are to expect them to embrace the innovations and understand how to maximize their productivity.

We also must do more long-term planning. We cannot consider new technologies as stand-alone pieces; we must plan for how they will affect other systems within our facilities and how they will enable us to upgrade other related systems.

Moreover, we must have local suppliers involved in the development of improved technologies. As our industry undergoes restructuring, we must rely on local engineering, manufacturing and maintenance support. It is a simple truth that steel companies no longer have sufficient internal support to survive without assistance in engineering, manufacturing and maintenance. Therefore local suppliers must have the knowledge and personnel to assist steelmakers’ operations and maintenance teams. The only way this can occur is if plant employees are closely involved with supplier personnel in the development of the new technologies.

Working together

Government, management and the rank and file must find ways to make certain the marketplace is fair and the working atmosphere is conducive to getting the most from the best technologies.

Government must be sure that foreign steel is not being dumped and our industry is playing on a level field.

Management must stand up and lead in a positive, productive direction. Steelmakers should not complain about foreign imports when they are responsible for a large portion of the imports. Those who import slabs for finishing to save costs contribute to our decline in the primary end of the steel-making process.

Top management also must do its part in reducing costs by taking part in wage reductions presented to the balance of the workforce. Mid-management and the rank and file must be willing to accept their responsibilities in cost-reduction programs. When new technologies are introduced, work rules must allow personnel with the proper technical ability and training to work on these systems. Employees in turn should receive training and additional education to raise their technical capabilities.

Power of partnering

Local equipment and maintenance suppliers must develop new and improved technologies and the steel industry must work with them in the development and use of new processes and products. This kind of partnership will enable suppliers to recruit and retain highly qualified personnel with the technical know-how necessary to restore America’s steel industry to a truly competitive position.

Meanwhile, technologies developed by suppliers must be designed for the capabilities of the personnel that will implement the process. And we need to understand technologies designed for use in Europe and Asia will not necessarily work in America due to differences in operations and maintenance practices.

Such partnering between steelmakers and local equipment suppliers will provide the opportunity for American companies to return to a leadership role instead of being followers.

All of us who work with and for America’s steel companies are in this together. We have the opportunity now and the capability to be the best in the world if we have the proper leadership and learn how to work together.

But the window of opportunity can close quickly. The question boils down to this: Will we respond to the wake-up call or remain sleeping?