Age: 56
Education: B.S. from Brown University; M.S. in metallurgy and materials science from the University of Pennsylvania
Previously: Has been with Nucor since November 1982, including a stint as GM of Nucor-Yamato joint venture; became vice president
in 1992; executive vice president in 1999; CEO in September 2000
Until Daniel DiMicco became CEO of Nucor, the country’s largest steelmaker had long been averse to growing through acquisitions. Previously, legendary CEO Ken Iverson preferred instead to build new plants. Some, meanwhile, believed that the company’s culture — performance-based pay and decentralized hierarchy, giving each individual plant a high degree of autonomy and self-determination — would be difficult to establish in plants that weren’t homegrown.
DiMicco was apparently not persuaded by this notion. He has acquired more than a dozen new plants since his September 2000 ascension, and the results of the strategy have vindicated his decision. Rather than being problematic, the acquisitions have had the effect of forcing some existing plants to innovate in order to stay competitive.
That kind of paradigm shift impressed our voters from the investment community. “What piqued my interest was what DiMicco has done with Nucor’s recycling program and his strategy of buying plants that share Nucor’s operating philosophy,” said Phil Kuhlenbeck, CEO of Ashworth Capital Management, a private-equity fund.
Under DiMicco’s watch, revenues have soared from $4.6 billion in 2000 to $14.8 billion as of the end of 2006, and in the same period profits have increased from $311 million to a whopping $1.8 billion. Perhaps most relevant to those surveyed, the company’s stock price has outperformed the S&P 500 by more than 500 percent, and as of late October had returned about 478 percent for the previous five years — good enough for DiMicco to squeak out a victory over Alcoa’s Alain Belda in the eyes of our respondents.
Upcoming Challenges:
DiMicco will be challenged to maintain his growth pace, as demand has recently cooled. Cheaper imports remain a threat, raw-material prices are increasing and the housing slowdown could mean less demand for sheet-metal products and steel-made appliances.
Executive Fact:
DiMicco has been called the “Working Man’s Evangelist” for his pro-manufacturing stance questioning other countries’ trade practices.
We compiled our list of 100 CEOs by starting with several hundred of the largest American corporations in terms of annual revenues. We then divided the list into the 10 economic sectors used by Standard & Poor’s Global Industry Classification Standard, and determined that each should contain a minimum of five companies.
We culled the list to 100 firms after considering a variety of objective factors (revenues, earnings, market cap, returns, sustained excellence) in addition to other, more subjective reasons, and determined the final list by committee.
We then asked our readers to grade each company’s CEO on a scale that correlated to 1 through 6, whereby 1 = below average; 2 = average; 3 = good; 4 = very good; 5 = exceptional; and 6 = the very best. There was also a category for “do not recognize”; we strongly encouraged respondents to rank only those executives they closely track. Whoever received the highest average score in each sector was the winner.
We sent the survey to a proprietary list of 80,000 hedge-fund managers, professional traders, private-equity professionals and investment bankers, asking them to include their age, company and job title. The results are confidential, though we did ask respondents whether they would mind being contacted later for comments about their selections, some of which are printed here.
Furthermore, those surveyed were asked to name the most outstanding CEO in each sector, and why, and to list five retired CEOs they most admired and five new or up-and-coming CEOs to watch.
For executives who have been CEO for fewer than three months prior to the survey, which took place in late September, we listed both the company’s previous and new CEO.