Boy, what a challenge this year is turning out to be!
Given power shortages, slow growth in key export markets, sharply lower commodity prices and generally subdued domestic demand we, as Industry and Institute, have our work cut out for us. One of the advantages of being at the SAISC and not in the trenches is to look back and forward to conditions in the Industry. When reading about steel Industry challenges going as far back as the 50s, search engines are of course useful tools. Many of the problems we are experiencing are not unique to South Africa and our steel Industry. A great many books have been written on the American, UK and European steel industries. So suddenly this looks like something we have seen before and fortunately there we have experienced people who have experienced the up-and-down nature of the steel cycle and who know what has to be done.
One of the SAISC strategic reports written in the 80s had some sound advice on what to do when experiencing bad times and I quote – “wait for good times”. I can’t believe that this is the correct approach in today’s environment but we have to accept that when outside events dominate we can and should deal with issues under our sphere of influence or control and try not to get bogged down with those we can’t.
So the answer is that there is no silver bullet. When our GDP is projected to be 2%or below we need to do what is necessary to stay alive and prepare if we can for when conditions improve.
Within all these challenges there must be some opportunities.
- The SAISC is a firm believer in innovation. Innovation of products and service offerings are needed to keep steel the material of choice in construction. Industry players need to identify new products to diversify into products especially with high export potential.
- Do we need to hit the reset button? Spencer has written an article based on visits to European fabricators.
- We are a globalised Industry and we have Africa rising on our doorstep.
- We can improve and enforce standards as they are more important than ever before. It may be easy for our BRICS partners to export, but it will not be easy to comply with all the necessary standards required.
- We can develop new markets with our unique set of skills.
- The steel Industry can proactively play a major role in solving many of the problems South Africa currently faces particularly with respect to infrastructure and energy.
From a strategic point of view are we:
- Selling into the right geography (This changes very rapidly within the global context)?
- Altering our cost structures to be competitive and profitable?
- Improving our skills? Do we have the right workforce skills?
- Constantly looking for new markets?
- Differentiating ourselves from our competition – not always in your traditional Industry?
- Standardising our products and services, to save time and money?
- Lowering logistics costs?
The SAISC and sub-associations are working very hard to make a difference to the Industry so please support us with your involvement in our activities and initiatives, and join the Institute.