Under the leadership of CEO Lorenzo Zambrano, Cementos Mexicanos, S.A. (Cemex) has become the largest cement producer in North America and the fourth largest in the world. As a component of its globalization strategy Cemex expanded into the United States by building terminals and exporting cement from Mexico. U.S. producers countered with an antidumping petition under Section 731 of U.S. trade law, complaining that they were injured by the imported cement. The case presents the situation in the cement market and the administrative process that resulted in a 58% duty on Cemex imports. Focuses on Cemex's strategy for addressing the antidumping petition and its aftermath.
Swot Analysis of "Cemex and Antidumping" written by David P. Baron, Justin Adams includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Antidumping Cemex facing as an external strategic factors. Some of the topics covered in Cemex and Antidumping case study are - Strategic Management Strategies, Strategy and Global Business.
Some of the macro environment factors that can be used to understand the Cemex and Antidumping casestudy better are - – challanges to central banks by blockchain based private currencies, geopolitical disruptions, increasing household debt because of falling income levels, increasing transportation and logistics costs, increasing commodity prices, there is increasing trade war between United States & China, technology disruption,
banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Cemex and Antidumping
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cemex and Antidumping case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Antidumping Cemex, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Antidumping Cemex operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Cemex and Antidumping can be done for the following purposes –
1. Strategic planning using facts provided in Cemex and Antidumping case study
2. Improving business portfolio management of Antidumping Cemex
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Antidumping Cemex
Strengths Cemex and Antidumping | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Antidumping Cemex in Cemex and Antidumping Harvard Business Review case study are -
Sustainable margins compare to other players in Global Business industry
– Cemex and Antidumping firm has clearly differentiated products in the market place. This has enabled Antidumping Cemex to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Antidumping Cemex to invest into research and development (R&D) and innovation.
High brand equity
– Antidumping Cemex has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Antidumping Cemex to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Global Business field
– Antidumping Cemex is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Antidumping Cemex in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Antidumping Cemex are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Innovation driven organization
– Antidumping Cemex is one of the most innovative firm in sector. Manager in Cemex and Antidumping Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Antidumping Cemex is one of the leading recruiters in the industry. Managers in the Cemex and Antidumping are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Antidumping Cemex has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Cemex and Antidumping Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Analytics focus
– Antidumping Cemex is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by David P. Baron, Justin Adams can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High switching costs
– The high switching costs that Antidumping Cemex has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Antidumping Cemex digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Antidumping Cemex has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Organizational Resilience of Antidumping Cemex
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Antidumping Cemex does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Antidumping Cemex has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Antidumping Cemex has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Weaknesses Cemex and Antidumping | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cemex and Antidumping are -
Low market penetration in new markets
– Outside its home market of Antidumping Cemex, firm in the HBR case study Cemex and Antidumping needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Cemex and Antidumping HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Antidumping Cemex has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Cemex and Antidumping HBR case study mentions - Antidumping Cemex takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Skills based hiring
– The stress on hiring functional specialists at Antidumping Cemex has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Increasing silos among functional specialists
– The organizational structure of Antidumping Cemex is dominated by functional specialists. It is not different from other players in the Global Business segment. Antidumping Cemex needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Antidumping Cemex to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Cemex and Antidumping, in the dynamic environment Antidumping Cemex has struggled to respond to the nimble upstart competition. Antidumping Cemex has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Antidumping Cemex has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High cash cycle compare to competitors
Antidumping Cemex has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Antidumping Cemex has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High bargaining power of channel partners
– Because of the regulatory requirements, David P. Baron, Justin Adams suggests that, Antidumping Cemex is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Antidumping Cemex supply chain. Even after few cautionary changes mentioned in the HBR case study - Cemex and Antidumping, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Antidumping Cemex vulnerable to further global disruptions in South East Asia.
Opportunities Cemex and Antidumping | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Cemex and Antidumping are -
Buying journey improvements
– Antidumping Cemex can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Cemex and Antidumping suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Antidumping Cemex to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Antidumping Cemex to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Antidumping Cemex can use the latest technology developments to improve its manufacturing and designing process in Global Business segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Antidumping Cemex can use these opportunities to build new business models that can help the communities that Antidumping Cemex operates in. Secondly it can use opportunities from government spending in Global Business sector.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Antidumping Cemex in the consumer business. Now Antidumping Cemex can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Antidumping Cemex to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Leveraging digital technologies
– Antidumping Cemex can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Antidumping Cemex can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Antidumping Cemex can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Antidumping Cemex can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Global Business segment.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Antidumping Cemex in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Antidumping Cemex has opened avenues for new revenue streams for the organization in the industry. This can help Antidumping Cemex to build a more holistic ecosystem as suggested in the Cemex and Antidumping case study. Antidumping Cemex can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Antidumping Cemex can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Threats Cemex and Antidumping External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cemex and Antidumping are -
High dependence on third party suppliers
– Antidumping Cemex high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Technology acceleration in Forth Industrial Revolution
– Antidumping Cemex has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Antidumping Cemex needs to keep up with the evolution of technology in the Global Business sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Antidumping Cemex business can come under increasing regulations regarding data privacy, data security, etc.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Antidumping Cemex.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Cemex and Antidumping, Antidumping Cemex may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Antidumping Cemex with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Antidumping Cemex in the Global Business sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Antidumping Cemex in the Global Business industry. The Global Business industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Regulatory challenges
– Antidumping Cemex needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Global Business industry regulations.
Stagnating economy with rate increase
– Antidumping Cemex can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Environmental challenges
– Antidumping Cemex needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Antidumping Cemex can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Increasing wage structure of Antidumping Cemex
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Antidumping Cemex.
Shortening product life cycle
– it is one of the major threat that Antidumping Cemex is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Cemex and Antidumping Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Cemex and Antidumping needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Cemex and Antidumping is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Cemex and Antidumping is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Cemex and Antidumping is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Antidumping Cemex needs to make to build a sustainable competitive advantage.
