In more than 12 years as Nucors chief executive, Dan DiMicco led the Charlotte-based steelmaker through explosive growth and became a national spokesman on manufacturing and trade issues.
Now DiMicco, who handed the CEO title to John Ferriola in January, is trying to leave his mark in another way: engineering a successful transition to the next leader.
At the end of this year, the more than 30-year company veteran will step down as executive chairman and leave the board. DiMicco said the company has been working on a leadership succession strategy since he became CEO in 2000. Thats because he took over after a famously rocky transition from the companys iconic CEO Ken Iverson.
When you have someone who is ready and a leadership team that has grown up, youve got to let them lead, DiMicco said in a recent interview at the companys SouthPark headquarters. Its been a great run, and its time to move on.
Before he departs, DiMicco, 63, on Tuesday will receive the Charlotte Chambers Citizen of the Carolinas award at the organizations annual meeting. He also took time to talk with the Observer about the economy, the state of the steel industry, Nucors future and his retirement plans. Questions and answers were edited for brevity and clarity.
Q. When you look back on your tenure, what was the biggest challenge you faced?
A. When I came into the CEO role, the industry was in the worst depression it had seen certainly in my lifetime. We were the subject of a massive flood of illegally traded steel from around the world. We had just joined the American Iron and Steel Institute, and I was named chairman. As a leadership team we had to make a decision: Should Nucor be leading the effort to overcome this illegally traded situation, which created this huge crisis in the industry overall, or should we defer to other people? And the leadership team decided we should work to be leaders in this through my position as chairman of the AISI.
So that was the single biggest leadership challenge that came from the outside and we ended up being successful in getting President (George W.) Bush and his administration to put a trade enforcement regulation on the books for when people are totally disregarding the rules of free trade. Internally the biggest challenge was going through the transition from your founder and icon, Ken Iverson, and not just keeping our culture intact but allowing it to grow based on its core principles to levels never seen before.
Q. What is the state of the steel industry now, especially compared to when you started?
A. The steel industry is much better than it was in 2000. A lot of consolidation took place between 2000 and 2005 by companies that had the financial wherewithal to do it. Nucor was one of them. Were much better able to withstand the challenges that come our way from unfairly traded imports or lousy economies. But the state of the steel industry, as a whole, is dependent on the economy and dependent upon the state of true free trade. Those are both challenges because there is massive overcapacity in the world, mostly created by China, which is 100-percent state-owned enterprises.
And the recession, the worst since the Great Depression, has not been handled properly in terms of getting growth going again. We are averaging less than 2 percent growth. There is a lot of uncertainty, a lot of things being done to handcuff the private sector and make our jobs to compete globally more difficult. And thats because we did not treat the crisis as the No. 1 priority. The No. 1 rule of leadership is you dont run from a crisis. You dont create an alternative crisis to distract from the fact that youre not dealing with the real crisis, and you bring people together.
Q. What do you see as the alternative crises that were created?
A. I sat in (President Barack Obamas) office in August of 2009 with three other CEOs and laid it out very clearly that the No. 1 crisis was jobs and economic growth and everything else would be taken care based on the success of dealing with that. And not going and distracting us from that No. 1 priority with a health care plan that no Republican supported. It just built divisiveness from day one, name-calling and nothing to bring the team together to deal with the real crisis.
Q. What would you have done to get the economy going again and creating more jobs?
A. They did nothing to stimulate the economy with real investments and create jobs where they were needed. And this whole concept of, Well, the skills sets arent there, so the unemployed cant fit the jobs of today is really hogwash. And I say that for this reason: All of these people that were out of work were gainfully employed in 2005, 2006 and 2007. And where were they out of work? They were out of work in manufacturing, and theyre out of work in construction and all of the services that fed off a strong construction and manufacturing sector. Thats where the emphasis should have been put. Policies should have been postponed or put in place to support the private sector to construct, to manufacture and to bring increased job growth and good-paying job growth into the economy. Dont get me wrong. Health care is an important thing, but how you go solving it is a very divisive issue, not something that should be brought into play when you have this crisis that outweighs it by a million-fold.
Q. Youre very passionate on these issues. Have you thought about running for office?
A. Thought about it? No. Have people mentioned it to me? Yes. In the environment that they have in Washington today, running for office would be a futile situation for someone like myself. Id be frustrated overnight. Ive told people I would be happy to be an adviser to any leader in Congress or in the White House who is serious about addressing the real crisis.
Q. When you took over, Nucor was barely profitable. Earnings got up to $1.8 billion in 2008. You made $593 million in 2012. Can the company get back to those heights?
A. Absolutely. On our own, with a poor marketplace with slow economic growth, we will be able to get back there. We have invested historically in our company in down periods. We save our money in good periods and invest them in down periods when things are cheaper, whether its building things or acquiring things, and weve done that. Since 2008, we have invested over $6 billion in our future. All of that will add to our profitability. Thats why its easy to say Nucors best years are ahead of it.
Q. Pretty famously during the recession, you did not lay off workers. Instead, you cut pay...
A. We didnt cut pay per se, but people who were on a bonus system earned less because there was less to produce. But they kept their jobs and we had them involved in all kinds of continuous improvement projects, whether it was personal or in the plants themselves. We focused on getting our teammates in the company as much work as possible so they would get their 40 hours. In the worst recession by far since the Great Depression, we continued our no-layoffs practice. Did some people leave the company? Yeah. Did some people retire? Yeah. But we didnt lay anybody off. When you have the right people, you need to keep the right people. Its a practice. We dont say its a no-layoffs policy because you never know what you dont know about whats coming at you. But if you can go through this last recession and not lay people off, thats a win for the long term.
Q. What are your plans after Dec. 31?
A. My short answer is whatever I damn well please and my wife will let me do. The longer answer is as chairman emeritus I will still have a connection to Nucor, and if I can be of support I will be. That will be at the request of our current leader, John Ferriola, and the board. There will be times I will be out there talking about trade and manufacturing issues. I have a hobby that I havent paid much attention to over the last 15 years, which is my muscle cars. I serve on the Duke Energy board. I will continue to stay involved with that. Ill also be helping with young people live their dreams as entrepreneurs. There are three groups of folks that I am currently supporting both financially and as a mentor.
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