Assignment II Creating value from internationalization CEMEX International Business Strategy Academic year 2014-2015 What benefits have CEMEX and the other global competitors in cement derived from globalization? To answer this question‚ we used the ADDING framework (HBS Press 2007). This framework consists of six components of value creation. The first one is “adding volume”. In the 1980’s‚ CEMEX refocused its strategy on growth through acquisitions instead of continuing to diversify horizontally
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What benefits have CEMEX and the other global competitors in cement derived from globalization? More broadly‚ how can cross-border activities add value in an industry as apparently localized as cement? - Reduction of tariffs associated with exporting - Due to internationalization these companies have been able to spread their risk. Therefore‚ if one market is not performing they can rely on the other (diversification) - Talent across markets - Ability to identify new emerging markets and having
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benefits have CEMEX and the other global competitors in cement derived from globalization? More broadly‚ how can cross-border activities add value in an industry as apparently localized as cement? (Question for Analysis) The oligopolistic nature of the cement business dictates the limited notion of business strategy‚ however CEMEX‚ one of very few cement producers found that through globalization‚ a variety of benefits can be obtained and utilized to their own. Expanding to the global market was
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Capabilities Capabilities are valuable‚ rare‚ costly to imitate and non substitutable are core competencies. Core competencies are sources of competitive advantage for the firm over its rivals. A sustained competitive advantage is achieved only when the competitors cannot duplicate the benefits of a firm’s strategy or when they lack the resources to attempt imitation. Sustainable competitive advantage results only when all four criteria are satisfied. For a capability to be a core competence
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Growth of Global Markets 1. The fundamental changes that are contributing to the growth of global markets I think are the changes in technology‚ basically of communication technology that are making it easier to do business globally. Firms take advantage of differences in cost and quality of various factors of production by expanding their business globally. 2. I think that one of the goals of every firm is to retain loyal customers. This is very important for the firm because‚ then they know
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CEMEX is the largest cement manufacturer in Mexico and the third largest in the world. The current status of the company shows that it has expanded its business worldwide‚ in both northern and southern America‚ the Caribbean ‚ Europe ‚ Middle East and South East Asia . Despite the technological maturity and unique culture of the cement industry CEMEX and all the other competitors in the market have benefited from the process of globalization. According to the adding model template CEMEX
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recommendations would you make to CEMEX regarding its globalization strategy going forward? In particular‚ on what kind of countries should it focus its future expansion? CEMEX expansion is a process where the company performs its due diligence and the aim of expanding into a country with a large population and high population growth. As the text stated CEMEX should continue to focus on developing Asian economies‚ Central America‚ the Caribbean and Sub-Saharan Africa. CEMEX should keep its eye on China
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social performance of CEMEX The relationship between natural environment and industries has often been named ‘dysfunctional’. An increase in the levels of awareness of the society towards activities of companies‚ both positive and negative‚ has pushed corporations to address to their corporate social responsibilities. Industrial Pollution has been a concern for the society. The effects of companies’ actions on the environment are constantly under scrutiny by the society‚ through different groups including
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Journal of Global Information Systems (GIS) Tuesday‚ 2nd July 2013 Abstract: The rapid changes in Information Technology (IT) has brought enourmous changes in the companies of each and every country and this made the companies to grow into Multi National Corporations (MNC). MNC’s are the driving force of building and operating the Global Information System (GIS). Intially Information System was focused to bulid and operate within the country. When the MNC companies started emerging globally the
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foreign direct investment strategies and decisions were really molded by the nature of their industry/product. FDI yielded the most profitable and controllable option which they felt would stimulate the fast growth of the company. When looking at the theories of FDI‚ it is easy to see why Cemex preferred a direct investment instead of the other options of penetrating these markets. Exporting was eliminated as an option right-off-the-bat due to their product‚ cement; specifically ready-mixed cement
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