CEMEX is an example of a firm that used step-wise and insightful strategy of talent management to attain a rapid growth in the cement industry. Before the Great Recession that began in 2008, the company had successfully become one of the most successful and largest companies in the cement industry. It achieved this through international acquisitions of related companies. However, during the Great Recession of 2008-2010, the company began losing its revenue to the point that it almost went bankrupt. This mandated a change is objectives and strategies in a bid to reduce its debts and gain its previous status. This paper compares the objectives and strategies of CEMEX prior to and after the Great Recession.
Most Important Markets of CEMEX before the Great Recession
CEMEX Company had gained access to large markets internationally before the Great Recession that occurred between 2008 and 2010. It was operating in several countries across the world. These countries provided international markets for the company and as a result, the company was able to obtain considerable revenue from its international operations. Some of its major markets included countries such as Spain, Venezuela, Panama, Dominica Republic, Colombia, the Philippines, Egypt, Indonesia, Costa Rica, and Chile (Hoshino, 2013).
CEMEX's Strategic Objectives and Target Markets Just Before the Great Recession
Prior to the Great Recession of 2008-2010, CEMEX Company was exhibiting tremendous growth in revenue. The company had the strategic objective of expanding into new continents. To achieve this, the company acquired already existing cement companies and other related companies in different parts of the continent. Therefore, acquisition acted as the company's springboard (McGuire, 2013).
In 2007, CEMEX Company had just won a majority stake in Rinker Group of Australia. McGuire (2013) explains that this made the company be one of the largest cement manufacturing and supplier of building materials in the world. Thus, it is important to note that Australia was an important target market shortly before the Great Recession began. Another important target market was the United Kingdom. In 2005, CEMEX had acquired RMC Company, which was the then largest company in the world that specialized in ready-mix concrete. For this reason, it is arguable that the company was targeting the United Kingdom's market.
Countries Which Appear to Be CEMEX's Most Appropriate Marketing Targets Today
The most appropriate target markets for the company today are the major countries in which it has the largest production capacities per year. According to Hoshino (2013), the top three target markets for the company include Mexico, the United States, and Spain. In addition, the company has the highest number of ray-mix plants in these countries. This implies that the company has the highest number of customers in these countries. Through Ghemawat's adaptation, CEMEX is able to create value addition to its major markets. It is able to meet customer requirements in these target market thus gaining a large market share. This has also enabled it to increase its revenue in these countries.
Implementation Devices Appropriate for CEMEX's Current Strategy
It is worthy to note that after the Great Recession, the company had to change its strategy. The acquisition spree had failed during the financial crisis, plunging the company into debts (Toporowski, 2016). This almost made the company go bankrupt. In order to settle the debts, the company had to divest some of its assets. For instance, it divested its assets in Venezuela which enabled it to pay some of its debts. The current strategy of CEMEX Company is to create value through managing as well as building a global portfolio of integrated ready-mix concrete, cement, aggregates, and related businesses. To achieve this, the company strives to achieve competitive advantage by valuing its employees. It hires the brightest and the best employees. In addition, it prioritizes their health to ensure zero injuries in the workplace. Another implementation device is to help its customers succeed. This involves listening to customer needs and building long-lasting relationships. Another way is to incorporate sustainability into its business. To achieve this, it minimizes ecological footprints that its operations have by championing for a low-carbon economy. Moreover, the company has increased its use of alternative sources of fuels and raw materials that are eco-friendly. The company has also been a champion of improving energy efficiency.
Why CEMEX Gained Competitive Advantage from Growth of Acquisition
As already stated, CEMEX gained a competitive advantage in the corporate market through large acquisition. This was majorly achieved through transnational, central, and local innovation. Specifically, CEMEX used globally liked innovation in which it successfully pooled its resources as well as the capability of different units from the parent company and its branches to manage and create an effective market.
Generally, the financial crisis is detrimental to the growth and development of firms. It plunges companies into debts, leading to insolvency. A good management involves initiating strategic changes that effectively restore the company to its initial status before recession occurred. CEMEX is a perfect example of a company that used effective strategies before the Great Recession of 2008-2010 to be a leading company in the cement industry and successfully used a totally different strategy after the Great Recession to turnaround its fortunes.
Hoshino, T. (2013). Multinationalization Strategy of Mexican Family Business. Family Multinationals: Entrepreneurship, Governance, and Pathways to Internationalization, 23, 117.
McGuire, S. (2013). Multinationals and NGOs amid a changing balance of power. International Affairs, 89(3), 695-710.
Toporowski, J. (2016). 13. The crisis of finance and the crisis of accumulation: it was not a 'Lehman Brothers moment'. The Great Financial Meltdown, 236.
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