Our new treasury system adds greater efficiency in cash flow management and speeds up the management decision-making process.

Our expanded human resources management system is also proving to be a big productivity booster, enabling employees to view payroll, appraisal, timekeeping, benefit, hiring, and application status information online.

As we head toward the conclusion of our PI initiative in December 2004, we'll be focusing on wrapping up the final two PI-1 follow-on projects: the expansion of our existing activity-based costing system into an activity-based management system, and the extension of our data warehouse to cover finance, purchasing, and other remaining business processes.

Serving Customers Better
The launch of our customer relationship management system in July 2003 marked a fundamental shift in our focus toward the customer both in mindset and business processes, enabling us to deliver the products and services our customers want when they want them. In conjunction with this launch, we upgraded our sales system and practices, implementing a mobile sales support system that allows our sales staff to process orders and provide service at any customer touchpoint. The new system also enables us to get to know end-user customers by providing direct links to our technical and sales departments as well as online access to current order, production, and shipment information via our Steel-N.com website for a superior service experience. These and other service innovations played a key role in boosting our internal customer satisfaction index rating from 70.4% in 2000 to 81.6% in 2003.

Delivering Satisfaction
Despite a week-long strike in May by unionized truck drivers that temporarily suspended domestic ground shipments, proactive management, continued innovation, and close cooperation with our customers enabled us to achieve a remarkable 97.7% on-time delivery performance for 2003. During the year, we continued to streamline and upgrade our logistics capabilities by consolidating control over all storage facilities, enabling us to cut inventories by 26.5% from 479,000 tons to 352,000 tons. We helped improve customer productivity and our own sales by spearheading a project to develop lightweight transport trailers, enabling us to ship up to two tons more steel on each land shipment. We also expanded our rail shipment capabilities, opening a rail yard capable of storing 18,000 tons of steel products in the Seoul region in December 2003. To meet the yard's 500,000-ton annual handling capacity target, we purchased 74 coil steel railcars, reducing shipping costs as well as shaving two days off the normal delivery time by ship.