CEMEX

Powerful Essays
CEMEX: GLOBAL GROWTH THROUGH SUPERIOR INFORMATION
CAPBILITIES
1. CEMEX is a cement company. What are the sources of competitive advantage in the cement industry? What is CEMEX's position in the global cement industry?
First, the cement business is cyclical. The uncertainty of the number of demand and sales restricts a cement company to gain profits stably. Thus, the expansion of the scale of the company is very critical to enhance the competitiveness, especially the international expansion to different countries and continents. Decentralized production and sales in a wide range of countries can offset the risk of shocks in some markets. On the cost side, as a capital intensive and cash generative industry, cement industry needs large scale to build up supplier’s bargaining power to reduce the costs. Overall, the scale of company and the expansion overseas are the critical sources of competitive advantage in the cement industry.
Founded in Mexico in 1906, CEMEX has grown from a small regional company to a leading producer and marketer of cement. It not only dominates the domestic market, but also operates cement and related products in more than 30 countries, especially in many emerging markets. In addition, it is the largest trader of cement in the world. At last, it is one of the world’s leading investors in IT industry.
2. Consider the period prior to 1997 in the case. What are the main IT -related changes that
Cemex has made? What are the primary capabilities that these changes have given to Cemex?
Where do these capabilities influence Cemex's performance?
First, in 1987, Gelacio Iniguez was hired to develop CEMEX’s information technology. He and executives made a three-year IT development plan. In 1988, CEMEX adopted a satellite telecommunications system, which was a creative move for the cement company. After that, in
1989, CEMEX merged Tolteca’s HP platform with its own platform. CEMEX reviewed its platform after the acquisition.
Second, in 1990, an

You May Also Find These Documents Helpful

  • Powerful Essays

    manufacturers as a source of fuel to fire their energy-intensive cement kilns. Alternatively, the company…

    • 1531 Words
    • 7 Pages
    Powerful Essays
  • Good Essays

    Cement

    • 769 Words
    • 4 Pages

    1. The cement industry in Pakistan is composed of 24 players with annual production capacity of around 40mln MT. The sector is dominated by six major players – Lucky Cement Limited, Bestway Cement Limited, D.G. Khan Cement Company Limited, Maple Leaf Cement Factory Limited, Gharibwal Cement Limited, and Kohat Cement Company Limited – constituting over 60% of the total production capacity. The industry maintains a positive correlation with GDP growth, which stood at around 7% during last five years. The major domestic demand drivers are Public Sector Development Programs (infrastructure), real estate and industrial construction. Pakistan Cement Industry - Capacity Share Conducive economic environment not only fueled the local Lucky 19% demand but also Others provided impetus for 39% Bestway capacity expansion. 11% Resultantly, the industry added significant capacity DG Khan and several new Kohat Maple Leaf Gharibwal 10% production lines are 6% 9% 6% scheduled to commence operations in 2009. The sector is currently facing stern challenges emanating from a wide spectrum of socio-economic risks including contracting domestic economic activity, slowdown in GDP growth and construction activity and heightened security risks. 2. Due to the commodity nature of the product, differentiation and brand equity is minimal. Furthermore, Cement Supply-Demand Trend (Pakistan) manufacturers as well as major consumers in the local market 40 35% are reluctant to enter into exclusive supply contracts. 35 30% Hence, the possibility of 30 25% gaining captive markets through 25 long-term contracts is non20% 20 existent.…

    • 769 Words
    • 4 Pages
    Good Essays
  • Satisfactory Essays

    Urbanization will be inevitably accompanied by the construction of city roads and various commercial residential building,Sale Of Sand Production Line which determines the demand for cement and sandstone aggregates .In general, the demand will keep increasing in a long time .…

    • 456 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    Lafarge-Aget Case Study

    • 873 Words
    • 4 Pages

    - Product offering: cement could be delivered with a bundle package of services to provided helpful support to the customer. Before that, Lafarge- Aget should conduct a marketing research about its customers’ needs and their expectation to offer them only valuable services.…

    • 873 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    The Indian cement industry is the 2nd largest market after China accounting for about 8% of the total global production. It had a total capacity of about 347 m tonnes (MT) as of financial year ended 2012-13. Cement is a cyclical commodity with a high correlation with GDP. The housing sector is the biggest demand driver of cement, accounting for about 67% of the total consumption. The other major consumers of cement include infrastructure (13%), commercial construction (11%) and industrial construction (9%).…

    • 1727 Words
    • 7 Pages
    Powerful Essays
  • Good Essays

    milleanium pharma

    • 718 Words
    • 2 Pages

    1) Millenniums Pharmaceuticals strategy basically focused on revolutionizing drug development through the use of new technology during growth phase and making organizational changes during its maturing phase of by making strategic improvements in the organizational structure, making alliances, outsourcing etc by having vertical integration and moving from upstream to downstream model. In phase 1, technology helped the firm leapfrog most other biotechnology firms in the early stage of drug target identification. But this could not prolong as technology and tools were diffused and competitors learned from Millenniums model. This prompted Millennium to shift its focus form early stage discovery alliances (upstream) to drug development and commercialization. Levin expanded strategy to include “personalized medicine,” which he envisioned would leverage Millennium’s technology platform to customize medicines to the genetic profiles of each patient and improve the effectiveness of drug treatment while limiting side effects. Levin began to realize how challenging it was to build expertise in a broad variety of therapeutic areas while expanding the value chain downstream towards commercialization. In phase III Levin realized that it would be more productive to focus on the particular field the company had competitive advantage in rather than concentrating on the broader arena which followed shift in its business model from R&D services organization to fully integrated on its own pipeline and narrowing their efforts to cardiovascular, inflammation and oncology. Although the strategies adopted aim towards achieving vertical integration and continuous improvements, their strategy does not align parallel with goal; also mission and vision seem to change more frequently than it should be.2) Millennium has pursued the strategy of vertical integration by moving from upstream to downstream commercialization, forming alliances, restructuring their model by narrowing their…

    • 718 Words
    • 2 Pages
    Good Essays
  • Powerful Essays

    To describe the characteristics of the modern construction industry we should look at the nature of demand for industry’s products which is related to wants. In this case there are some particular characteristics; demand for houses, hospitals, office buildings, schools and many other structures. That is one of the reasons why its looks as it does. In this context it means the quantity and value of for example houses that people or organisations want and are prepared to pay for.…

    • 1464 Words
    • 6 Pages
    Powerful Essays
  • Satisfactory Essays

    Marketing and Key Issue

    • 266 Words
    • 2 Pages

    Key Issue 1: Cemex is advancing thanks to the good administration they have. The way they have meeting with the top leaders is good. As these leaders have been able to take advantage of the opportunities they have seen. The PMI process they have seems to be working out.…

    • 266 Words
    • 2 Pages
    Satisfactory Essays
  • Powerful Essays

    A.Rehman Qazi

    • 3151 Words
    • 13 Pages

    5. In 2010 the new government proposed a different IT strategy. Why was this change initiated?…

    • 3151 Words
    • 13 Pages
    Powerful Essays
  • Better Essays

    case study

    • 2610 Words
    • 9 Pages

    There was a clear value shift that was taking place from PC focused technologies to those that were based on the global information network. Network based companies such as Microsoft, Cisco, Pets.com, AOL, Netscape, etc., saw huge turnovers and capital…

    • 2610 Words
    • 9 Pages
    Better Essays
  • Powerful Essays

    Cement Market in Egypt

    • 3959 Words
    • 16 Pages

    CEMENT SUPPLY AND DEMAND ANALYSIS ............................................................................................................ 5 MARKET PLAYERS ............................................................................................................................................ 7 CEMENT PRICING AND COST .............................................................................................................................. 8 Pricing .................................................................................................................................................... 8 Cost of production.................................................................................................................................. 9 Cement Companies Financial Performances.......................................................................................... 9 EGYPTIAN GOVERNMENT CEMENT CONTROL ...................................................................................................... 10 Export control ...................................................................................................................................... 10 Price…

    • 3959 Words
    • 16 Pages
    Powerful Essays
  • Powerful Essays

    YTL Cement’s purpose in beginning this business is to supply quality cement to local construction companies for a competitive price especially in the eastern corridor of peninsular Malaysia. There were no cement plants in the eastern side of peninsular Malaysia. So, cost of purchasing cement was high due to logistics. Our plant in Pahang solved all issues as we could now provide cement with a much cheaper price.…

    • 2186 Words
    • 8 Pages
    Powerful Essays
  • Good Essays

    Cement Sector in Pakistan

    • 2969 Words
    • 12 Pages

    None of the cement producers in Pakistan enjoys any material product differentiation because of the highly standardized nature of product therefore consumers usually regard ‘price’ as a key determinant. Major constituents of the cost are energy & power - over 60% of cost of production of cement - and transportation costs. In addition to these elements efficiency of production process is critical in keeping the overall cost structure competitive. In this regard, size of the plant, its age, and origin - European or Chinese - are of importance.…

    • 2969 Words
    • 12 Pages
    Good Essays
  • Satisfactory Essays

    Mexico’s first true multinational $19.4 billion debt (six times its ==> Region’s most admired company EBITDA) Management and Employee Training Lack of free cash flow The “CEMEX WAY“: standardization of ADR value of CEMEX by the end of processes, efficient integration 2008: strategy $4.01 Strong branding and customer satisfaction 10% cut on it’s worlwide staff…

    • 504 Words
    • 3 Pages
    Satisfactory Essays
  • Good Essays

    * Cemex’s target market in Mexico does not realize their dream home, while they can afford it.…

    • 710 Words
    • 3 Pages
    Good Essays

Related Topics