CEMEX Mexico: The Path to Responsible Competitiveness SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of CEMEX Mexico: The Path to Responsible Competitiveness
The case presents CEMEX Mexico's situation in 2004, shortly after its social responsibility committee was created and became operational. Two distinctive stages in SR development are described. During the first stage, the company's SR approach was paternalistic and lacking in strategic meaning. The second stage started as a result of several organizational changes undertaken to streamline SR efforts and to incorporate them into the company's business strategy. This shift was initiated in the late 1990s, when CEMEX reviewed its contingency management processes and fueled the creation of its Social Responsibility Unit, the coordination of community relations and the establishment of its Communications and Social Responsibility Committees. Although social responsibility initiatives had begun to bear fruit, the company faced the challenge of integrating it into its culture. SR was a strategy known mainly to top management, but it was not explicitly embedded in training, recruiting, compensation or performance evaluation practices. This hindered its swift incorporation into the company's organizational culture. The case describes the organizational change process (in terms of strategy, structure and culture) that resulted from SR adoption and the managerial decisions geared at its internalization. There was little evidence to assess how deep this cultural change really was. A personnel survey had revealed that most employees were unaware of CEMEX's community-oriented initiatives. The SR Manager's goal was to turn this issue into a personal trait for both the company and its employees -i.e., to embed it in CEMEX Mexico's DNA. Yet, some members in the organization were still doubtful.
Swot Analysis of "CEMEX Mexico: The Path to Responsible Competitiveness" written by Loretta Serrano, Hector Diaz-Saenz includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sr Cemex facing as an external strategic factors. Some of the topics covered in CEMEX Mexico: The Path to Responsible Competitiveness case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the CEMEX Mexico: The Path to Responsible Competitiveness casestudy better are - – digital marketing is dominated by two big players Facebook and Google, increasing energy prices, talent flight as more people leaving formal jobs, wage bills are increasing, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs,
cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of CEMEX Mexico: The Path to Responsible Competitiveness
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CEMEX Mexico: The Path to Responsible Competitiveness case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sr Cemex, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sr 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 Mexico: The Path to Responsible Competitiveness can be done for the following purposes –
1. Strategic planning using facts provided in CEMEX Mexico: The Path to Responsible Competitiveness case study
2. Improving business portfolio management of Sr Cemex
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sr Cemex
Strengths CEMEX Mexico: The Path to Responsible Competitiveness | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sr Cemex in CEMEX Mexico: The Path to Responsible Competitiveness Harvard Business Review case study are -
Sustainable margins compare to other players in Leadership & Managing People industry
– CEMEX Mexico: The Path to Responsible Competitiveness firm has clearly differentiated products in the market place. This has enabled Sr Cemex to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Sr Cemex to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Sr Cemex in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the CEMEX Mexico: The Path to Responsible Competitiveness Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Innovation driven organization
– Sr Cemex is one of the most innovative firm in sector. Manager in CEMEX Mexico: The Path to Responsible Competitiveness Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Sr 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.
Learning organization
- Sr Cemex is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Sr Cemex is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CEMEX Mexico: The Path to Responsible Competitiveness Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Sr 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Sr Cemex digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sr 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.
Diverse revenue streams
– Sr Cemex is present in almost all the verticals within the industry. This has provided firm in CEMEX Mexico: The Path to Responsible Competitiveness case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to lead change in Leadership & Managing People field
– Sr 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 Sr Cemex in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Sr Cemex in the sector have low bargaining power. CEMEX Mexico: The Path to Responsible Competitiveness has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sr Cemex to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Sr Cemex has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in CEMEX Mexico: The Path to Responsible Competitiveness HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses CEMEX Mexico: The Path to Responsible Competitiveness | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CEMEX Mexico: The Path to Responsible Competitiveness are -
No frontier risks strategy
– After analyzing the HBR case study CEMEX Mexico: The Path to Responsible Competitiveness, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High cash cycle compare to competitors
Sr 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study CEMEX Mexico: The Path to Responsible Competitiveness, it seems that the employees of Sr Cemex don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High bargaining power of channel partners
– Because of the regulatory requirements, Loretta Serrano, Hector Diaz-Saenz suggests that, Sr 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.
Increasing silos among functional specialists
– The organizational structure of Sr Cemex is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Sr Cemex needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sr Cemex to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Sr Cemex has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - CEMEX Mexico: The Path to Responsible Competitiveness should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Sr 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.
Aligning sales with marketing
– It come across in the case study CEMEX Mexico: The Path to Responsible Competitiveness that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case CEMEX Mexico: The Path to Responsible Competitiveness can leverage the sales team experience to cultivate customer relationships as Sr Cemex is planning to shift buying processes online.
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 Sr Cemex supply chain. Even after few cautionary changes mentioned in the HBR case study - CEMEX Mexico: The Path to Responsible Competitiveness, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sr Cemex vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Sr Cemex has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the CEMEX Mexico: The Path to Responsible Competitiveness 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 Sr Cemex has relatively successful track record of launching new products.
Opportunities CEMEX Mexico: The Path to Responsible Competitiveness | 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 Mexico: The Path to Responsible Competitiveness are -
Buying journey improvements
– Sr Cemex can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. CEMEX Mexico: The Path to Responsible Competitiveness 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sr Cemex is facing challenges because of the dominance of functional experts in the organization. CEMEX Mexico: The Path to Responsible Competitiveness case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Sr Cemex can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Sr Cemex can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Manufacturing automation
– Sr Cemex can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sr Cemex can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Sr Cemex has opened avenues for new revenue streams for the organization in the industry. This can help Sr Cemex to build a more holistic ecosystem as suggested in the CEMEX Mexico: The Path to Responsible Competitiveness case study. Sr 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
– Sr Cemex can develop new processes and procedures in Leadership & Managing People 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.
Better consumer reach
– The expansion of the 5G network will help Sr Cemex to increase its market reach. Sr Cemex will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sr Cemex can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, CEMEX Mexico: The Path to Responsible Competitiveness, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Sr 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sr 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Sr Cemex can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sr Cemex can use these opportunities to build new business models that can help the communities that Sr Cemex operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Threats CEMEX Mexico: The Path to Responsible Competitiveness External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CEMEX Mexico: The Path to Responsible Competitiveness are -
High dependence on third party suppliers
– Sr 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.
Consumer confidence and its impact on Sr Cemex demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
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 Sr Cemex.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Sr Cemex can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Sr Cemex has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Sr Cemex needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sr Cemex can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study CEMEX Mexico: The Path to Responsible Competitiveness .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Sr Cemex needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Sr 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sr Cemex in the Leadership & Managing People industry. The Leadership & Managing People 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.
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 Sr Cemex in the Leadership & Managing People sector and impact the bottomline of the organization.
Regulatory challenges
– Sr 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 Leadership & Managing People industry regulations.
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 Sr Cemex business can come under increasing regulations regarding data privacy, data security, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Weighted SWOT Analysis of CEMEX Mexico: The Path to Responsible Competitiveness 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 Mexico: The Path to Responsible Competitiveness 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 Mexico: The Path to Responsible Competitiveness 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 Mexico: The Path to Responsible Competitiveness 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 Mexico: The Path to Responsible Competitiveness 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 Sr Cemex needs to make to build a sustainable competitive advantage.