Strategic Management and Governance

Running Head: STRATEGIC MANAGEMENT AND GOVERNANCE
Strategic management and governance
Student’s Name
University Name
Author’s Note

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STRATEGIC MANAGEMENT AND GOVERNANCE
Table of Contents
1. Introduction..............................................................................................................................3
2. Discussion................................................................................................................................3
2.1 Background of the company.............................................................................................3
3. Micro analysis of the company and industry............................................................................4
4. Discussion................................................................................................................................7
5. Recommendations and conclusions..........................................................................................9
6. Reference List.........................................................................................................................11

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STRATEGIC MANAGEMENT AND GOVERNANCE
1. Introduction
This report will look forward to make and evaluation of the environmental conditions of the
Global steel industry. Severstal Steel manufacturing organisation of Russia is one of the leading
organisations of the steel and mining industry. A detailed analysis of external environmental
factors using the pestle model have been done in this report in order to determine the sustainable
position of the organisation in the Global industrial environment. In the following section, a
detailed discussion based on the strengths and weaknesses of Severstal and their comparison
with the Global industrial factors, as identified in the previous section has been conducted. The
emphasis of this industrial analysis is to determine the overall condition of Steel manufacturing
as well as the exporting market. The factors that have been helping Severstal to maintain a
sustainable business position have been highlighted in the discussion section along with
identification of the challenges that they had been facing. The last section provides
recommendations to the organisation for sustainable business development.
2. Discussion
2.1 Background of the company
Severstal is a Russian company dealing in steel manufacturing and mining. The organisation has
been operating since the leader half of the last century and is situated in Cherepovets, Russia. the
organisation has been able to maintain sustainable International growth because of strong
Business Development sense of its owner Alexey Mordashov (Guo & Zhang, 2016). Since the
year 2000 the organisation has been concentrating on international acquisition and currently they
have their Steel plants trade in countries like Russia, Ukraine, France, Italy, Africa as well as
Asia Pacific countries like Kazakhstan and other parts of Middle East. Organisation has become

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STRATEGIC MANAGEMENT AND GOVERNANCE
a global new instrument by means of their market divestification strategy; they have the mission
of becoming the leading Global brand of Steel and mining industries in the upcoming decade.
3. Micro analysis of the company and industry
Political analysis
About all Industries experiencing high recession after 2008, the Steel manufacturing industry is
the most prominent. In spite of global crisis, China is the only country which has been able to
maintain its Monopoly over Steel export and maximum proportion of international steel is
exported from China. In fact the export volume is excess in comparison to the Global demand,
because of which steel prices in sharply Falling In the international market, making the major
Global supply chain companies vulnerable (Kazakova et al. 2018). The initial decision of
overproduction for facilitating the internal economy, did not yield positive results, because of
which China look on the strategy of massive Steel export at a lower than industry specific price.
However, the Chinese government is not ready to accept this as there aggressive strategy to
maintain market Monopoly over Global Steel. According to them, the manufacturing and output
process of steel production in China makes the final products cheaper in compared to price of
Steel in other companies. Major market influence in the Steel industry is experienced from the
countries of European Union as well as North America, which have the benefit of free trading
with many trading nations of the world (Kozhevnikov, Kozhevnikova & Bolobanova, 2017).
Again, as potential market for consumption of steel and allied products, Middle East has been
emerging as a potential market for the cheap Steel products of China along with other countries
like South America and specific countries of Asia.
Economic influence