strategic and innovation management in a...

STRATEGIC AND INNOVATION MANAGEMENT IN A POST-PRIVATIZED BRAZILIAN STEEL COMPANY

MARCELO AMARAL, D.Sc. 1 Triple Helix Research Group – THERG-Brazil, Institute of Human and Social Sciences, Fluminense Federal University, Rua Desembargador Ellis Hermydio Figueira, 783, Volta Redonda, 27213-415, Brazil, [email protected] GUSTAVO DA SILVA MOTTA, D.Sc. Program of Graduate Courses in Management, Institute of Human and Social Sciences, Fluminense Federal University, Rua Desembargador Ellis Hermydio Figueira, 783, Volta Redonda, 27213-415, Brazil, [email protected] RAPHAEL JONATHAS DA COSTA LIMA, D.Sc. Program of Graduate Courses in Management, Institute of Human and Social Sciences, Fluminense Federal University, Rua Desembargador Ellis Hermydio Figueira, 783, Volta Redonda, 27213-415, Brazil, [email protected] MARIANA COSTA FAGUNDES, M.Sc. Program of Graduate Courses in Management, Institute of Human and Social Sciences, Fluminense Federal University, Rua Desembargador Ellis Hermydio Figueira, 783, Volta Redonda, 27213-415, Brazil, [email protected] MARILIA MEDEIROS SCHOCAIR, B.Sc. Triple Helix Research Group – THERG-Brazil, Institute of Human and Social Sciences, Fluminense Federal University, Rua Desembargador Ellis Hermydio Figueira, 783, Volta Redonda, 27213-415, Brazil, [email protected] Abstract: The paper analyzes the strategic and innovation management evolution of National Steel Company (CSN). The company was created by the state during the Second World War, and organized as a company town, until 1993, when it was privatized. In the last 20 years, the CSN´s internal and international market, strategies and innovation efforts have changed deeply. The research question was if the steel business is still the core business and what CSN´s position in the global raw material production and steel market? This work combines exploratory and descriptive researches approach. The theory of networks of production and the Triple Helix approach were applied to interpret geo-economic relations resulting from the globalization process. Regarding the technical procedure, this is a case study. The data presented was a result of two different researches done in the last five years. The first one was a documental research, based on official CSN´s documents, as annual reports and interviews with actual and former employers with managerial level. The second one shows the patent data extracted from FAMPAT database, using Questel Orbit and VantagePoint software. It was identified and analyzed 336 applications from 1971 and 2009. Since 2000, CSN started to make investments with the aim of adapting the model of sell goods and 1 Visiting Scholar at North Carolina State University, Institute of Humanities and Social Sciences, Poe Hall, 2310 Katherine Stinson Dr., Raleigh, NC, 27607; Visiting Researcher at Research Triangle Park, The Frontier, 800 Park Offices Dr., Durham, NC, 27709.

International Association for Management of Technology IAMOT 2016 Conference Proceedings

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services, which ceases to be strictly domestic and turns global. The company did: acquisitions in Brazil and abroad; modernization production process; technological upgrading of existing plants, and enter in new market niches to increase the added value of steel production. This led to work in five different fronts (steel, mining, logistics, cement and energy) and to internationalize, which helped to make it one of the largest and most influential holdings of Brazil. From the viewpoint of the networks of production, in the process of CSN´s evolution a series of formal/informal networks was built, destroyed and rebuilt. It´s possible to state that there was a change in the strategic profile of the CSN. First, the company migrated from a state-centered organization to a spoke and hub company after the privatization process. Regarding University-Industry-Government linkages the typical relationship in the phase “company town” (1945-1990) can be classified as the configuration type 2 of the Triple Helix in which the Government, through a state-owned company, sets the target to companies, university and shapes society as a whole. In the post-privatization period the relationship becomes distant. Several confluence areas of the three helices spheres are disrupted and renegotiated. The local university loses its primacy in relationships and other institutions are sought. New university-industry bilateral relations are constituted. Currently, University-Industry-Government linkages are tenuous without getting to characterize a configuration type 1 (laissez-faire). In economic terms, the analysis of the CSN´s evolution helps to understand the dynamics of Brazilian capitalism, through its relationships with stakeholders’ spheres of university-industry-government, and their effort to compete on the international arena. A state capitalism has predominated along the century XX in Brazil where the system of production of goods and services has built apart from the system of science, technology and innovation.

Keywords: CSN; Privatization; Regional Development; Innovation Management; Strategy; Brazil.

1. Introduction

The paper analyzes the organizational, strategic and innovation management evolution of Companhia Siderúrgica Nacional (CSN), a company created by the Brazilian state during the Second World War, and a symbol of the country´s industrialization process in the twentieth century. Its analysis helps to understand the dynamics of Brazilian capitalism, through its relationships with stakeholders’ spheres of university, business and government, and their effort to compete on the international arena. The question that guides the research is whether the steel business is still the core business and what her position in the global steel production and marketing. This is an exploratory research approach that uses theory of networks of production and the Triple Helix approach to interpret geo-economic relations resulting from the globalization process. Besides this introduction the paper was structured containing six parts.

2. Theoretical Review This item presents the central concepts to the analysis of the trajectory of CSN throughout its history.


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“Company town” The “company town” can be regarded as a "mini-city" in which a set of community facilities including houses, commercial buildings, schools, hospitals and recreational areas belonging to a company and where control is exercised over the people´s inflows and outflows, setting a closed urban nucleus. The emergence of these “company towns” would have happened in Europe and in the United States in the twentieth century, following the expansion of the Capitalism´s scales of production (with a greater concentration of capital and labor) and also as a myth of Capitalism´s perfect society in the service of production. The “company towns” are associated with the image of progress and modernity in the region where they are being installed. It follows the idea of industrialization to economic growth and local development (Lima, 2010). Production networks, industrial districts and areas of investment attraction In the last 35 years industrialized countries have enhanced the knowledge base of their own economies, in accordance with the new techno-economic paradigm based on the diffusion of communication and information technologies (ICTs) (Harvey 1992).

The production relations undergo constant change, whether caused by cultural, environmental, political or social influences. What´s observed today is that such changes cause a climate of uncertainty for producers, governments and consumers. Peter Dicken (2011), among others, deal with these uncertainties as a reflection of globalization, which has been recurring issue due to the large development of ICTs and the speed in which we have access to the news. This information explosion feeds the insecurity climate and reinforces the feeling that something is happening in the world. These uncertainties reflected in the business world, which has sought strategies to sustain business in a market that has become increasingly competitive, comprehensive and demanding.

Production networks are extremely complex structures with varied links that form multidimensional multilayered lattices. Networks benefit from advances in logistics systems and ICTs to strengthen relations time/space and set on a global, national, regional and local scales or levels. It can act dependently or independently one from another (Dicken, 2011; Lima, 2010).

One of the current organizations challenges is how to remain attractive and competitive in a business environment increasingly influenced by the internationalization of information, products and services. Also, maintaining and improving its workforce and increasingly focusing on profitable investments.

Ann Markusen (1995) explain that developed countries are the regions where the phenomenon of competitiveness intensification are better observed, because labor is relatively scarce due to low birth rates and their high-qualified skills, generating high productivity, but too high costs. In relation to emergent economies, recently recognized as world powers, formerly called "developing countries”, which have a vast amount of labor relatively qualified and idle, and therefore cheaper, what can be said is that there are spaces more and other less competitive. The differences in productivity and costs between economies and regions are the factor that contributes to the reallocation of companies to the emerging countries. It´s easy to find spaces where plants can be installed in exchange of government subsidies and lower operating costs.


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A subsequent challenge for the companies located in emerging regions is to remain competitive. With increased productivity and income, there is a consequent increase in costs, this creates the risk of capital and investments transfer to new emerging regions. As an alternative to not equate with competition, regions investing in the concept of improving the "local climate for investment", causing economists, businessmen, geographers and planners seek alternatives to increase the attractiveness of industrial districts established.

In general, one Industrial District "is an area spatially delimited, with a new direction of economic activity and export specialization defined, it can be related to the natural resource base, or certain types of industry or services”. Four types of industrial districts are proposed by Markusen (1995): Marshallian; Hub and Spoke (in which the regional structure is built around one or more large plants belonging to one or a few companies); Industrial Platform Satellite (branches/subdivisions of transnational corporations, which may be attracted to regional facilities and low cost of labor or may have advanced technological features); and State-centered (a state-owned company serves as an propeller for the regional economic development). Innovation management Investments in R&D (Research and Development) are seen by many organizations as a way of achieving competitive advantage. In this process there are ways of protecting technological development, which may be through the registry in official departments (such as a Patent) or by no registration, to avoid public consent of the new technology developed (as an Industrial Secret, for example).

By choosing to register by patent, a company usually seeks to protect its inventions, avoiding that third parties may take advantage freely of the efforts made in this innovation. There are several reasons for patenting, some of which may be of economic matters: as having a strengthened placement in the market; a greater return in investments; the possibility of selling or licensing the invention; a legal instrument against counterfeiters; and as an incentive for competition, for the development of new technologies or for the improvement of those already made (Buso, 2011).

Thus, data on patents have become extremely useful indicators of R&D activity. They reflect the results of efforts of businesses, industries and countries, as official information being publicly accessible. By this, the information on patents has attracted many authors who have studied patents using several techniques of statistics (Grupp & Schmooh 1999 cited Fagundes et al, 2014). Triple helix

The Triple Helix approach (TH) argues that the proximity/intensity of linkages between universities, industry and government are critical to improving the environmental conditions that favor innovation. In the TH approach, university is raised to a position equivalent to industry and government, representing a triad of institutional spheres with equal and overlapping activities. The origin of this change is the growing importance of research and new knowledge creation process and to the current economy, which brought a third mission to the university, named “the second academic revolution”. This new university´s role came to join the missions of education and research and assumes that the university shall have an


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entrepreneurial attitude, incorporating economic development to their academic goals (Etzkowitz, 2008).

The university-industry-government relations can take various configurations, also called stages. In the first, titled TH I, both universities and companies are inserted within the governmental sphere - to the authors this stage is practically overcome in the contemporary world being typical on socialist states and/or totalitarian or military governments. In stage TH II, each actor plays their role alone, with well-defined borders and little interaction. This configuration is called laissez-faire. In the TH III, an overlap occurs between the performance limits of each actor, the interrelationships deepen in quantity and complexity, with the emergence of hybrid organizations from these interfaces. In this configuration arise so-called hybrid and consensus spaces. Regional development entities or technology parks are typical results of linkages at this stage.

There are several channels of university-industry interactions that contribute to increasing innovation processes in organizations. Lester (2005) identified and classified four categories named "Channels of Interaction": Education and training (The basic role of the university, contributing to the development of local human capital); Codified knowledge (R&D in the university contributes to the increase codified knowledge stock, including publications, patent applications, software, and hardware); Local capacity to solve scientific/technological problems (various forms of support for the creation/development of new ventures, such as incubation programs, technology parks, joint research projects, consulting firms, university laboratories use by companies); and Space of debate (university as an open space for an ongoing debate on the development of the industry, new technologies and market opportunities).

3. Research Design This research is exploratory and descriptive. Regarding the technical procedure, this is a case study about a company that personifies, in many aspects, the region and country economic development. In this study, the company's historical evolution the current situation and prospects of its development model are analyzed. The case study is indicated when the investigated object can be considered as a contemporary phenomenon, in which the researcher has little control over events and there is the need to use multiple information sources, seeking converging research lines (Yin, 2005). In this particular case, it’s important the study of CSN´s evolution, which will be done in section 4. The data presented below was a result of two different researches realized between 2011 and 2014 (Fontes, 2011; Lima, Schocair, Amaral, 2013; Fagundes et al, 2014).

4. CSN’s trajectory This item will discuss the CSN, whose evolution was organized into four parts. A fifth part was included to analyze the technological development effort of the company. Symbol of brazilian development (1945-1980) Founded on 1941, CSN started its operations on 1946. The President Vargas Steel Mill (UPV) is located next to the river Paraíba do Sul, current city of Volta Redonda, in the south


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of the state of Rio de Janeiro, equidistant from Rio de Janeiro, Sao Paulo and Belo Horizonte (the main consumer centers in Brazil), which concentrates half of the country's GDP. Initially, the company only produced coke, pig iron castings and long products (Fontes, 2011).

In the 1970s, even as a state company, CSN promoted two expansion programs in order to increase its production capacity. The first was completed in 1974, when the production capacity reached 1.6 million tons of crude steel and its product line was expanded. The second circle was completed in 1977, when the production capacity reached 2.4 million tons (Fontes 2011; Lima, Schocair, Amaral, 2013). In this same period, the process of globalization and industrial restructuring were intensified, called by some authors as the crisis of Fordism’s production standard (Harvey, 1992).

Some innovative technological capabilities were developed in CSN during this period, such as the development of R&D and engineering for process improvement and development of supervision and control of the production process systems activities (Castro e Fiqueiredo, 2005). Crisis and privatization (1980-1994) The third update program production was completed in 1989 when the CSN reorganized UPV in order to conform to the new production scales. The UPV peaked 4.5 million tons of crude steel produced per year.

This was a particularly difficult period marked by labor movements, accelerating inflation, political instability and economic packages (Fontes, 2011). In the political field, becomes majority the understanding that the state should withdraw from the economy, leaving only its basic functions. This change process continued and was expanded in the 1980s, creating an unprecedented movement of trade and financial openness and accelerating economic restructuring and the internationalization of production (Diniz, Crocco, 2006 apud Ferreira, Leopoldi, Amaral, 2012).

During the 80s the company was losing money and it was considered a major problem. The Brazilian government even wondered closing it because the expenses were excessive and returns low. The privatization of CSN occurred in 1993. The auction lasted about three days and the major stakeholders, articulated by the Grupo Vicunha, a Brazilian textile holding, got only 25% of stocks offered, below the 50% required. So, partners were attracted for a shared management as Banco Bamerindus (now HSBC), Banco Bradesco and Companhia Vale do Rio Doce (Fontes, 2011)

Soon after the privatization, the company was managed in several ways before having a given control. In 1995, the Executive Benjamin Steinbruch, from Grupo Vicunha, assumes the presidency where it remains till now.

The trajectory of the company and the city, between 1945 and 1994, is typically a “company town”, in which the company, as central leverage of city development, provides benefits to employees beyond the working relationship and have a decisive influence on the city´s formation, including its geospatial organization, with neighborhoods to the workers, engineers and upper level managers. The end of a “company town” (1994-2002)


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A comprehensive restructuring process is performed for privatization and post-privatization leading to revision of the role of "company town" and a break with the city. CSN while state-owned company had vices and its organizational structure was overloaded. At the end of 1993, it has nearly 40,000 direct and outsourced employees, which was reduced to just over 20,000. The effect was an economic and social crisis in the city of Volta Redonda (Monteiro, 1995 apud Fontes, 2011).

During eight years, until 2002, there were a broad process of rethinking the company and modernize it in technical and managerial terms. This work was led by group of professionals commanded by economist Maria Silvia Bastos Marques, who chaired the company between 1996 and 2002. The company´s control became to be exercised by the President of the Board of Directors and major shareholder Benjamin Steinbruch.

After deploying numerous upgrade programs, CSN currently produces about 5.8 million tons of crude steel per year. The number of direct employees is reduced from about 15,000, in 1995, to just over 8,500 in 2005, as a result of the processes automation and implementation of integrated management systems (Fontes, 2011). Between 1994 and 2009, productivity per employee increased 600%. (Amaral, Schocair, 2015)

Over the years, actions for the technological modernization of UPV were practiced in CSN. Some factors allowed the implementation of new management and organizational structure, facilitating the integration of knowledge between units, such as: the provision of courses and internal/external training; the hiring of professionals from abroad; partnerships with customers for design of new steels and suppliers to process improvement; the participation of the factory floor in the solutions to problems; groups to address anomalies and standardization, as well as projects with external research centers, used to acquire new knowledge and increase the number of specifications, such as steel for electrical purposes, two-piece cans and automobile industry (Castro and Figueiredo, 2005).

This variety of learning mechanisms provided to CSN more technical knowledge; making new practices were aggregated to the unit and the flow of knowledge to spread the organization. Further, because the increase specifications required by customers, the knowledge flow now occurs more dynamically and mechanisms have been implemented, allowing the integration of knowledge between people from different areas. All these efforts influenced on reducing costs and increasing flexibility of new products by new processes (Castro and Figueiredo, 2005).

In the post-privatization period, CSN has focused on improving its technical performance in processes, influenced by the accumulation of technological capacity. This emphasis seems to have been determined by the need to increase the company's competitiveness, driven by the privatization process itself, beyond the business context of the time; they started to demand better economic performance. Moreover, this process improvement wasn´t reflected in the output indicators technological development process, such as patents. Global player (2002-2013) Since 2000, with the aim of adapting the model of sell goods and services, that ceases to be strictly domestic and turns global, CSN start to make investments: in acquisitions nationally and internationally; in the modernization production process; in technological upgrading of existing plants, and specially in new market niches to increase the added value of steel production.


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This led to work in five different fronts (steel, mining, logistics, cement and energy) and to internationalize, which helped to make it one of the largest and most influential holdings of Brazil.

In 2008, the production of crude steel in the UPV reached 5 million tons and CSN had a record profit (R$ 5.8 billion/US$ 2.8 billion) as a result of investments made to grow horizontally incorporating markets niches that have connection with the steel. The figure 2 illustrates the CSN´s growth between the 2000-2010, demonstrating its investments in diversification and internationalization.

CSN is a leader in several segments in the steel market. Its production of iron ore grows at astonishing rates year after year. Both fronts seek intermediate domestic and international sales contributing to the maintenance of marketing indexes of its goods heated and to boost sales in places that are inserted. The company has a large structure of ports and railways to the production outflow. Moreover, new investments are being made to expand capacity in logistics and power generation plants. Additionally, CSN takes waste from steel production to manufacture cement, proving the cost reduction strategy of the company, which in turn has been shown to be effective and can be perceived by the consumer who purchases the product at very competitive prices. All these investments and strategies resulted in the horizontal growth of the company, which focuses on the international market while supplying the domestic market.

As a publicly held corporation, its shares are traded on the stock exchanges of São Paulo (BM&F/Bovespa) and NYSE. Currently, it´s a highly integrated company, with businesses throughout the steel production chain, from the iron ore mining to the commercialization of the various manufactured products. This system combined with efficient management process turns CSN in one of the lowest cost steel producer in the world. However, since 2014 the company is suffering with the economic crisis in Brazil and the steel capacity excess in the world. The demand of steel and iron ore has fallen and affected the financial structure of the company. In 2015, CSN decide to sell some complementary assets to stop the burning of cash flow.

Figure 1: CSN´s corporation Figure 2: CSN´s internationalization

Source: CSN (many years)

Source: CSN (many years).


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Technology development Bazzo (2010) reviewed 335 patents applications or utility models, made by CSN between 1982 and 2009, and found that the CSN has undergone many organizational changes that have undermined the quality management intellectual property in the company. Only 93 of these applications (28%) were turned into patents. The amount of 82 were developed by internal effort and 11 as a result of external partnerships, with the help of four firms and four educational and research institutions. This means that CSN seeks to develop its technological capacities preferably through internal resources, which also shows lack of experience in the cooperation of management in technical development and in the transfer of technology (Castro e Figueiredo, 2005).

From 2002 on, the network of cooperation decreased in size, its density increased and its network prevalence continued under the influence of the company. In addition to reducing the number of partnerships, the number patent applications filings also decreased. This scenario can be seen as two opposite perspectives: CSN demonstrates a weakening in its internal innovational environment and also demonstrates that it does not build the right context for learning/knowledge sharing with external sources; and it can be a change in the pattern of choices of technologies to be used for its protection, showing that the company has become more careful in selecting the technologies that interest it (Bazzo, 2010).

Fagundes et al (2014) shows CSN patent data, extracted from FAMPAT database through Questel Orbit and treated by VantagePoint version.7 software. As seen in the following figure, 336 applications were found, made between 1971 to 2009, being 274 of these made by CSN and 62 by subsidiaries companies. Figure 3: CSN´s Patents Applications

Source: Fagundes at al. (2014)

The average of applications filed between 1980-1995 was of 16.5, whereas in the period of 1996-2009 was of 5.07, showing a reduction in the amount of deposits in recent years. Privatization could have been a fact that may have influenced this change in technological development. The now private company may have chosen to keep its trade secrets and to buy technology already embedded in finished equipment and systems. Another reason for this reduction could have been a budget shortage destined to research projects, which would result in a smaller volume of applications.

The technological field with the most applications in patents was of Materials (88


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applications), which were constant throughout the studied period. Table 1 seeks to understand a relation between CSN and other organizations in technological development.

As seen, six universities have made larger amounts of deposits along with CSN (47). However, these amounts are fairly small if compared to the total amount of deposits made by the company being studied (336).

Table 1: Partners

Organization

Activity Deposits Organization

Activity Deposits CSN Company 274 UNIFEI University 2 PRADA Subsidiary 61 UNIFRAX Company 2 UFF University 14 UTFPR University 2 UFSCAR University 11 COBRAPI Company 1 UNIFOA University 8 CONNECT Company 1 UFRN University 7 DELTA Company 1 ETPC Technical

School 4 FIBRAFOR

M Company 1

USP University 4 FILSAN Company 1 VCI BRASIL

Company 4 INAL Subsidiary 1 IPT Research

institute 3 PLANEPAR Company 1

PARQTEC Research institute

3 STRAINLAB

Company 1 UFMA University 3 UBM University 1 IFSC University 2 UFMG University 1 UFPB University 2 USS University 1 UFS University 2

Source: Fagundes at al. (2014) Figure 4 shows 70 collaborations of CSN with other organizations. The red circles

represent business organizations that have been identified, and the blue circles represent the university research institutes. There are two groups that stand out. The biggest one involves five institutions (PARQTEC, UFSCAR, UFRN, UFPB and UTFPR) in addition to CSN. Following, there is one with three business organizations (COBRAPI, FILSAN, and UNIFOA). The size of the network, which represents the collaboration of CSN in production technology, consists of 29 knots, which involves the company itself, its subsidiaries and other 26 organizations. The density of this network is of 24%. The network of technology collaboration of CSN has few knots and few links between these knots, which shows that technological development in the company has little external influence and when there is, it seems be in occasional situations (Fagundes et al, 2014). Figure 4: Technological collaboration network


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Source: Fagundes at al. (2014)

5. Analyses From the viewpoint of the production networks, it´s possible to understand the changes in the global steel chain, shifting the analysis focus of simple comparison between models of state, national and transnational enterprises to observe the organization of a structured global network.

In the process of CSN´s constitution a series of formal and informal networks was built. The company forms part of their suppliers and allocate on its surroundings areas, making considerable part of their purchases in this space and generating economic and social development. The manpower shall be formed locally at all levels and for that such high quality technical schools are comprised as well as the Metallurgical Engineering School which is now part of the UFF. The relationship of UFF and CSN is quite atypical, perhaps one of the few recorded cases of reverse spin-off where the company originates university.

From a business standpoint, new networks are formed. The company before public and with the focus on the domestic market becomes a global player in the industry. Since 2002, capitalized, it shoots purchases of companies abroad and expanding business in mining, cement and production of special steels.

Based on the Markusen´s typology of industrial districts, it’s possible to state that there was a change in the strategic profile of the CSN and its economic geography. First, the company migrated from type 4 (state-centered) to type 2 (spoke and hub) with the privatization process. Possibly, in the last ten years, it has migrated again to a model that looks like an Industrial Platform Satellite. The CSN´s decision center is no longer in Volta Redonda. Although the company has originated in the city, it´s currently a transnational Brazilian capital corporation headquartered in São Paulo, with Volta Redonda as a one of the productive locus only.

An important aspect of this case is the development of a culture where it´s installed directly related to your industry, then most likely the association “Volta Redonda, a steel


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town”, which spreads throughout the economy (Hotel Sider, Highway of Steel, bus company City of Steel, among others).

Regarding University-Industry-Government linkages the typical relationship in the phase “company town” can be classified as the configuration type 2 of the TH in which the Government, in this case through a state-owned company, sets the target to companies, university and shapes society as a whole. In the post-privatization period the relationship becomes distant. Several confluence areas of the three helices spheres are disrupted and renegotiated. The local university loses its primacy in relationships and other institutions are sought. New university-industry bilateral relations are constituted. In recent years, the local university goes through a process of rethinking and creates new dynamic, occupying new spaces, to remain present in the region. Anyway, University-Industry-Government linkages are tenuous without getting to characterize a configuration TH I.

New relationships are being built in which the university approaches the government as a way to think and act in favor of regional economic development, but also as a way of qualifying manpower for the new industrial cycle. This model creates demand for the university, according to the classification proposed by Lester (mainly support the transfer of industries), but also the limits, because there is a tendency of transnational companies brings technology and innovation of their headquarters. Thus, there are opportunities only to small local adjustments, not generating endogenous capacity to innovate and perpetuating the needs of capital and technology.

As for CSN's interest in the university is punctual, maintained contractual relations with various actors, for solving specific problems. One must understand that the production model of the company is capital intensive, but the technology is mature and market product stable. Therefore, only incremental innovation processes in search of improving productivity are required. Thus, the expenditure of the corporation with technology development is small and more focused on purchasing equipment (Amaral, Shocair, 2013).

Bazzo (2010) identified the development of 93 projects that culminated in patents, from 1982 to 2001. The company seeks to develop its technological capabilities preferably with internal resources, which shows a little experience for the management of technological development in cooperation and technology transfer, damaging the innovative potential of the company. The applications done by CSN showed great difference in standards in pre and post years of privatization (Fagundes et al, 2014).

In 2015, a new agreement between CSN and UFF was signed where the area of new products development and the CSN´s technology office looked for UFF´s competence in technology and innovation management. It´s more a managerial and strategic partnership to maps and understand market than a collaboration to solve technical problems (http://www.uff.br/?q=uff-e-csn-assinam-acordo-de-cooperacao-tecnica).

6. Final remarks The work aimed to analyze the organizational and strategic changes at Companhia Siderúrgica Nacional (CSN), a company created by the Brazilian government and symbol of the country´s industrialization process in the twentieth century. The research design was based on analysis of several existing studies, field research through interviews and data collection in the CSN´s annual public reports, with reference to the period 2000-2010.


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The study supports the notion that between the foundation date and the eighties, CSN has focused all its efforts to improve and modernize its steel production plant, located in the city of Volta Redonda.

The information gathered showed that from 2000, with the aim of adapting the model of selling goods and services, the company actuation ceases to be strictly domestic and start to have global characteristics. CSN becomes to invest in acquisitions nationally and internationally, in modernization of production process, in technological upgrading of existing plants, and especially in new market niches to increase the added value of steel production. This led to work in five different fronts (steel, mining, logistics, cement and energy) and to internationalize itself, which helped to make it one of the largest and most influential holdings of Brazil. However, the steel business is still the core business of the company with about 50% of the gross revenues of the group, but the mining sector has a higher profit margin.

The data show that there was a first transition of company, from a local/national, to a transnational business corporation. What is still open is the setting for this group. A second transition from steel to mining is underway, but the result is not yet clear, largely because of the interdependence between the two sectors and recent economic crisis.

Acknowledgements The authors would like to acknowledge the Carlos Chagas Foundation of Research Aid of the State of Rio de Janeiro (FAPERJ), the National Council of Scientific and Technology Research (CNPQ), the Coordination of Research and Higher Education Aid (CAPES) and the Fluminense Federal University (UFF) for funding and provide stricture to the develpmento of several research projects and the Companhia Siderúrgica Nacional (CSN) to the access of documents and data.

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