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CEMEX is a Mexican company that has become a major international competitor in cement while maintaining a higher level of profitability than other, long-established majors. CEMEX’s superior profitability supplies a basis for discussing the sources of superior performance in a global context. In addition, the wide array of benefits that CEMEX derives from its operations in different countries broadens conventional notions of why firms globalize.
After you review the case, prepare a response (4-5 pages) to the following case questions:
1) 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?
2) How specifically has CEMEX managed to outperform its leading global competitors in the cement industry? Please focus on comparing it with Holderbank, which is the other large competitor principally focused on cement. What do this comparison and the other data in Exhibits 4-8 suggest about the competitive game being played out among the major international companies?
3) What accounts for the sequence in which CEMEX entered foreign markets? How do the markets it has entered recently compare with the markets that it entered early on?
4) What recommendations would you make to CEMEX regarding its globalization strategy going forward? In particular, what kinds of countries should it focus its future expansion on?