Risk management and anticipation: A case study in the steel industry

Abstract

In this paper, the authors show how the concepts of anticipation and risk management are applied in order to effect a paradigm shift in a specific sector of the steel industry. This transformation can be observed in at least three areas: the pro- duction, sales, and marketing of highly engineered components and services; the creation of a systematic analytical approach to customers' plants and equipment; the development of a Techno-Commercial Analysis as a communication tool designed to undergird and stimulate anticipation-based risk management strategies in steel mills. The steel industry is particularly good for validating the concepts of anticipation-based risk management. First, the steel industry is lagging in respect to modern informa- tion technologies and so-called rationalization. Second, the steel industry is in an expansion phase, even while it is facing extreme competition. These factors have motivated plant owners and managers to optimize the potential of their operations. Therefore, they are increasingly willing to invest in new strategies to achieve this goal.