POSCO ICT, "full-stretch" of 3 year integrated synergy

2012.12.17

- Integration of IT and engineering capability to execute a solution-based business.
- The company’s iinternal trust and positive energy have realized a successful ‘chemical integration’
- Innovations from way of doing business 'strengthen' organizational competitiveness

The POSCO ICT (CEO, Hur Nam-Suk) incorporated in the last 2010 by the merger of POSDATA, an IT service provider, and POSCON, an engineering company has early overcome namely 'J-Curve' easily prevalent in the merged enterprise through 3 year PMI (Post-Merger Integration) activity, and is ready to create a real synergy effect.
POSCO ICT gained 638.4 billion won sales and 26 billion won operating profit till the last 3rd quarter. Also in 4th quarter, it is expected to exceed the last year profit, 36 billion won, with a continuing upward trend.

The reason for this performance is that POSCO ICT has reinforced its constitution as it is through the last 3 year PMI activities. POSCO ICT encourages employees to execute the work on their self-directed basis by making them establish a work plan by themselves, and POSCO ICT employees prepare a monthly work plan at the beginning of month, and are evaluated according to the performance at the end of month.
And project works, not daily routine, are selected as the improvement task in each quarter, with the execution result evaluated. Accordingly, most of employees perform one or more of improvement tasks each quarter, followed by the result evaluation.
This keeps balancing daily routine work and improvement tasks.

The analysis is that monthly and quarterly evaluation by this method, changed from the existing yearly evaluation, makes employees concentrate on their own valuable works and enables their motivation stronger. POSCO ICT is seeking a work diet by newly constructing the BI (Business Information) system that enables all information retrieved by system but does not require various types of report materials and .It is performing the forecast management that monitors company's major performances, such as orders, sales, profit and loss, and more on the system and captures a variety of issues in advance to reduce the risk. It adopted the purchase method by competitive bid for cost saving in the current economic depression, and operates a pooling system for each occupational group to raise the rate of operation.

Differentiation strategy is taken in terms of business. First of all, POSCO ICT has the technologies in combination with IT, control, electricity, and more, and energetically run engineering businesses, such as smart grid, new recycle energy, environment, etc.

POSCO ICT prepares a strategy for sophistication of IT business to try to revise a business portfolio. POSCO ICT, through such sophistication strategy, maps out a plan for transition from the existing order-oriented business to a solution-centered business to raise both profitability and stability and to create a virtuous circle.
Smart grid and new renewable energy fields are launched and nurtured as a new business. With this, it provides LED light product, builds light system including controlling system, and offers light-related total services through POSCO LED, a subsidiary. And it established PONUTech, a nuclear power maintenance company, and plans to extend its business areas, including nuclear power plant's instrumentation and control and maintenance, specialized in nuclear power MMIS (Man Machine Interface System, nuclear integrated instrumentation and control system)

POSCO ICT stands out in overseas market advance. POSCO ICT establishes an organization in full charge of overseas businesses since 2010, and supplemented a strategic point to advance overseas markets by newly forming corporations in Brazil and Indonesia. The items for overseas market advance come from its competitive steel industry, including new renewable energy, construction, railway, etc.

POSCO ICT actively takes part in constructing still mills abroad and manufacturing bases in Indonesia, Brazil, Vietnam, and other nations. POSCO in collaboration with Indonesian national steel enterprise, Krakatau Steel, is constructing an integrated steel mill where POSCO ICT builds the related system. In addition, POSCO ICT are involved in the project for construction of the integrated steel mill underway in Brazil. POSCO ICT, in this project, performs the key role in IT, control, engineering, such mechanical equipment as shaft furnace, raw material, sintering, coke, steelmaking, strand casting, and more including the EIC (electricity, instrumentation, computer) needed for constructing an integrated steel mill.

From enterprise cultural aspects, a thanks campaign is being conducted, including one good deed a week, one volunteer work a month, reading two books a month, and 5 thanks a day. If employees are satisfied with and thank for daily lives, individual's personality changes positively. Moreover, theny can concentrate on the work much more higher so that it will naturally lead to corporate performance. Through these activities, the organization is strengthening the trust and chemical fusion internally.