In a tanda, a group of individuals contributed a small sum each week for ten weeks. Cemex, one of the world’s largest cement producers, created a blue ocean of high profitability and growth in the cement industry that historically competed solely on price and functionality. As a result, most of Mexico’s poor had insufficient and inconsistent savings to purchase building materials, even though having a cement house was the stuff of dreams in Mexico. Cemex went a step further, … Hello Martha, could you briefly introduce CEMEX, especially its inclusive business model? This case describes CEMEX’s major acquisitions and its process of post-merger integration. This innovative platform addresses the main problems inherent to poverty and inequality in vulnerable communities, such as inadequate housing, limited land ownership, lack of access to basic services, unemployment, and lack of financial inclusion, through micro-credits and other services. By Bharathwaj Mohan LT 7A 2. Its current business models have … Since the company launched this new emotional orientation of Cemex coupled with its funding and technical services, demand for cement has soared. Once again CEMEX is ahead of the market in applying IT to create tangile value while transforming the business. Even though most poor families owned their own land and cement was sold as a relatively inexpensive functional input material, the Mexican people lived in chronic overcrowding. Cemex operates 67 cement plants, 1,784 ready-mix facilities, 362 aggregate … CEMEX has carried out to determine how they influence their dominance index or market power. Operating in conjunction with our Construyo Contigo platform, through this program, we have partnered with 184,103 individuals to date since 2006, allowing for more transparent transactions that reach people in need. This model promotes job creation and self-employment, contributing directly to SDG target 11.1. ... or have suggestions, please send an email to csr@cemex… Currently Cementos Mexicanos is the industry leader in building's materials with global presence as it produces markets and distributes cement in approximately 50 countries, maintaining business … #BlueOceanShift and #BlueOceanStrategy are worldwide business strategy bestsellers, helping you to move beyond competing and start creating your #blueocean. Introduction. According to the World Bank (2019), 7 out of 10 people will live in cities by 2050, and there are currently 1 billion urban poor. It was during 1998, after Mexico’s economic crisis, when CEMEX … Clearly a role model … CEMEX is the subject of a new roundtable story, “CEMEX’s Strategic Mix,” a discussion among several of its senior executives that was instigated by a Strategy& research project on … This website uses cookies to deliver you a better experience. … Cemex’s answer to this dilemma came with its launch of the Patrimonio Hoy program, which shifted the orientation of cement from a functional product to the gift of dreams. CEMEX’s global expansion represented a 180-degree turn for a company whose very name is an abbreviation of Cementos Mexicanos. All participants win the 1,000 pesos one time only, but when they do, they receive enough to make a large purchase. This strategy contributes to SDG target 4.3. Why Cemex? Think of it as a wedding registry, except that instead of giving silverware, for example, Cemex positioned cement as a loving gift. Since our launch of this groundbreaking social business model in 1998, we have reached 2.96 million participants in this underserved market. We use cookies to ensure you get the best experience on our website and continuing implies your consent -. Founded in 1906, the company did business nearly … Select from the icons below to learn more. CEMEX is a global leader in the building materials industry. Role of Information System in CEMEX Business Model: The various information systems implemented by CEMEX has also changed the business model of the company. If the market size was estimated to be a hefty $395bn in 2017, it is projected to reach $682bn at a CAGR of 7.8% by 2025, and CEMEX currently takes home about 7% of this pie. The implementation of these clean cook stoves has improved the families’ quality of life—saving time in the collection of firewood and cooking, and reducing the risk of lung diseases, eye infections, and burns by open stoves. The winner however, did not receive the total sum in pesos but rather received the equivalent building materials to complete an entire new room. With 4 objectives organized around the economic, environmental, social and governance pillars, our sustainability model is supported by 13 top priorities that ensure sustainability is embedded into every aspect of our business. CEMEX is a multinational cement firm, which originated from Mexico. Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments. Cemex new business process model. There were far more noncustomers than customers. We partner with microfinance institutions (MFIs), governments, and local women groups. PH has spurred CEMEX to replicate this business model in other developing countries and develop additional inclusive businesses that address the needs of low-income communities. For CEMEX… The program has operated in Mexico, Costa Rica, Colombia, the Dominican Republic, and Nicaragua. Value of merger and acquisition deals in the global cement industry up to 2014; Source: Statista, McKinsey, Dealogic The CEMEX … 2www.cemex.com CEMEX is founded in 1906 with the opening of the Cementos Hidalgo plant in northern Mexico. A startup is an entrepreneurial project that seeks, either with their own investment or with the help of a third party, to undergo a journey towards successful monetization of a product or service. The program utilizes a business model that engages … Cemex complemented the winnings with the delivery of the cement to the winner’s home, construction classes on how to effectively build rooms, and a technical adviser who maintained a relationship with the participants during their project. In the Patrimonio Hoy, the winner is directed toward building room additions with cement. It also looks at CEMEX’s expansion strategy, as well as the company’s efforts to diversify geographically and achieve a more vertically integrated business model. Operating Model. Is a flexible business model that brings our building products and solutions to low-income families living in substandard housing who require a partial subsidy and/or micro-loan in order to make home improvements or build new homes. The new jobs created under our Growing Platform’s initiatives, as well as the cost savings that result from access to affordable housing and services, directly reduce the proportion of men, women, and children of all ages living in poverty in all of its dimensions, contributing to SDG 1, 10, and 11 through targets 1.4, 10.1, and 11.1. CEMEX is a global building materials company that provides high quality products and reliable service to customers and communities throughout the Americas, Europe, Africa, the Middle … Blue ocean strategy is based on over decade-long study of more than 150 strategic moves spanning more than 30 industries over 100 years. To date, our Growing Platform is only present in Latin America, we are continuously working towards developing shared value programs in other countries where we operate. During 2019, we installed 1,383 ecological stoves in 158 communities in Mexico. Most of families’ extra money was spent on village festivals, quinceañeras (girls’ fifteen-year birthday parties), baptisms, and weddings. Its ultimate goal is to foster home safety and quality, while positively impacting partners’ health, wealth, and education. We have about 40,000 employees and are headquartered in Mexico. Our shared value programs are contained within an umbrella called "Growing Platform". As part of CEMEX USA's Logistics Supply Chain area, Procurement develops and executes sourcing strategies to support all business lines, including Cement, Ready Mix, Aggregate, Pipe, Block and … Rural migration to urban locations leads to irregular dwellings that lack appropriate services and infrastructure to achieve economic growth, thus intensifying a vicious cycle throughout generations. Implemented by the CEMEX-TEC de Monterrey Center, is a commercial and capability-building strategy that increases demand for our products by developing potential construction workers and masons’ technical and entrepreneurial skills to foster housing upgrades and construction. Is a flexible business model that brings our building products and solutions to low-income families living in substandard housing who require a partial subsidy and/or micro-loan in order to make home improvements or build new homes. 1 CASE STUDY CEMEX (A):BUILDING A GLOBAL LATINA AN OVERVIEW OF THE CASE STUDY ABOUT CEMEX CEMEX … The qualitative analysis is based. The program is offered on demand through co-investment partnerships. It did so by challenging the functional–emotional orientation of its industry, as path five of blue ocean strategy’s six paths framework suggests. Tackles the lack of affordable housing in low-income communities, enabling those with low startup capital and income to afford high-quality materials and technical assistance, contributing directly to SDG target 11.1. In 2019, 5,594 families accessed quality affordable housing and employment through our Self-Employment Centers in Guatemala, Nicaragua and Mexico. Intel is a good Value … As it stood, however, the market was unattractive. The company is an industry leader in sustainability as well, with their sustainability model being embedded in all aspects of their business strategy and day-to-day operations. At its debut, the Patrimonio Hoy building materials club that Cemex set up consisted of a group of roughly seventy people contributing on average 120 pesos each week for seventy weeks. View our company profile, investor reports, sustainability focus and much more. CEMEX is fostering innovation by changing the way employees work. The research of W. Chan Kim and Renée Mauborgne focused on discovering the common factors that lead to the creation of blue oceans and the key differences that separate those winners from the mere survivors and those adrift in the red ocean.The database and research have continued to expand and grow over the last ten years since the first edition of the book was published and the strategic moves we studied depict similar patterns, whether blue oceans were created in for-profit industries, non-profit organizations, or the public sector. The result: Patrimonio Hoy participants build their homes or additions three times faster at a lower cost than the norm in Mexico. In traditional tandas the “winning” family would spend the windfall on an important festival or religious event such as a baptism or marriage. Using this website means you are okay with this. We have been doing inclusive business … Cement Industry - CEMEX 1. Endorsing CEMEX’s Sustainability Model, priorities and core KPIs; ... Europe, and other places where CEMEX does business, it is a crime for CEMEX directly, or through an intermediary, to offer, pay, or … Is a business model that enables our company and social entrepreneurs to reach new markets with cleaner, healthier cooking solutions through the production and commercialization of concrete cook stoves. Digital transformation is alive and well at CEMEX, a global leader in building materials.It started its journey two years ago, evolving from a traditional brick-and-mortar business model to a … Inspiration. CEMEX is a global building materials company that provides high-quality products and reliable service to customers and communities around the globe. Construyo Contigo is an integral program comprised of four solutions, which can be applied separately or in conjunction, depending on the community needs: If you would like to learn more about the programs, how partnerships work, or have suggestions, please send an email to csr@cemex.com. It did so by shifting the orientation of its industry from functional to emotional. CEMEX’s Sustainability Model … At the foundation of Patrimonio Hoy was the traditional Mexican system of tandas, a community savings scheme. Limited success outside core business – Even though CEMEX, S.A.B. Cemex announced today the successful execution of its integration to SAP-centric enterprise platform for its operations across all business … Please check our, Resilient and Efficient Building Solutions, Environmental Excellence for Responsible Growth, New Types of Clinker & Clinker Substitutes, Code of Conduct when doing business with us. The Value Chain Analysis can also be done by CEMEX S A B de C V to maximise the operational efficiency, reduce waste and integrate sustainability in business operations. Patrimonio Hoy is one of the first private initiatives that combine what most companies aspire to: it is a real inclusive business … To know more about the program and if you are interested on applying, please follow this link. 05 September 2011. Cemex reported 15% year-over-year cement volume growth in the U.S. business in the fourth quarter, and the highest quarterly EBITDA (up 25% to $186M; 18.4% margin) since 2007. Why? If you are interested on learning more about self-construction, please refer to our manual (only available in spanish). Construapoyo utilizes flexible technology that allows other entities, such as private companies and governments, to provide funding for upgrading housing, including relief projects, and to deliver building materials clearly and efficiently. In the first week, lots are drawn to see who “wins” the pot in each of the ten weeks. It promotes high-quality and cost-effective building, as well as the use of sustainable criteria, including energy saving and affordable clean technologies. The model … CEMEX’s leadership goes beyond building materials. It is encouraging a change in practices towards more collaboration, transparency, and openness, and enabling these changes through a Social Networking platform with a business … Whereas Cemex’s competitors sold bags of cement, Cemex was selling a dream, with a business model involving innovative financing and construction know-how. Cemex went a step further, throwing small festivities for the town when a room was finished thereby reinforcing the happiness it brought to people and the tanda tradition. SUSTAINABLE BUSINESS STRATEGY. CASE STUDY CEMEX (A):BUILDING A GLOBAL LATINA MASTER IN BUSINESS ADMINISTRATION 2014 MANAGERIAL FINANCE (FIN 745) ANALYZING CASE STUDY CEMEX (A) : BUILDING A GLOBAL LATINA Prepared by: FARAH NADIAH IBRAHIM 2013812912 Prepared for: DR NIK NAZIMAN pg. In Mexico, cement sold in retail bags to the average do-it-yourselfer represents more than 85 percent of the total cement market. It is the process that is widely used for identifying … Is an inclusive business that enables microfinance entities and distributors from our value chain to offer financial solutions to do-it-yourself (DIY) homeowners, so they can acquire construction materials to improve their homes. Shift offers a unique example of how the use of social media based collaboration tools can instill and promote innovation and idea exchange at a global organization. Annual sales … This also helps CEMEX build an inclusive business model where the project helps the local community, creates significant social impact and generates revenue for the company to sustain the model. Cemex went a step further, … Participants become new customers as they improve their homes and provide services to others. Here are a few examples of blue ocean strategic moves from a variety of different industries and sectors. It reduces the construction time to build a 44 m2 house from 15 years to three to six months and develops skills that enable homeowners to upgrade their homes. This philosophy is the foundation upon which we built CEMEX . Whereas Cemex’s competitors sold bags of cement, Cemex was selling a dream, with a business model involving innovative financing and construction know-how. • Major success in industry with moderate “globalization drivers” – #1 Concrete, #3 Cement, #1 Cement transport • Major success from a country without obvious advantage • Interesting business model … In 2019, 13,322 families participated in this program, through which they gain access to our company’s network of contractors, support with land ownership, a micro-credit loan with a customized financial plan; and reduce the time and cost of building a home by 30%. Overall, Cemex created a blue ocean of emotional cement that achieved differentiation at a low cost. It has won multiple awards, including the UN Programme’s 2006 World Business Award in support of the UN Millennium Development Goals and the 2009 UN Habitat Award for Best Practices in Affordable Housing Solutions. … Globalization Of Cemex Financial analysis is the assessment of the stability, viability as well as profitability of a sub-business, business or project. IDC has released a case study of CEMEX’s implementation of its integrated business process model based on SAP platform. development of this document, the CEMEX Code of Ethics and Business Conduct (“the Code”), which was unveiled by Lorenzo H. Zambrano, Chairman of the Board and Chief Executive Officer, on April … When people bought cement they were on the path to building rooms of love, where laughter and happiness could be shared —what better gift could there be? For more than 15 years, Cemex has been contributing to solving the housing shortage in underserved areas through its Patriomonio Hoy program. In sum, the UK acquisition and its timing posed transformational challenges to the Cemex Way as the company moved into the ready-mix business model with RMC, faced superior … Whereas Cemex’s competitors sold bags of cement, Cemex was selling a dream, with a business model involving innovative financing and construction know-how. Few families built additions, and those that did took on average four to seven years to build a single additional room. The company, once a privately owned business with 6,500 employees had expanded to a publicly traded multinational firm … Through partnerships with governments, our Centers for Self-Employment enable families to receive technical assistance and training regarding the production of building materials, including concrete blocks and other components that they can use to expand their homes. One key component of Cemex’s strategy and approach to business is to achieve operational efficiency (“Our Approach”). We developed the model so that every func-tion—corporate, regional, and country (business unit) level—is united toward a common objective. This is seen particularly in their global programs such as the acclaimed Patrimonio Hoy program spearheaded by Cemex Foundation Mexico.