Large-Scale Change Concepts: CEMEX

Paper Summary:

This paper describes how international expansion affected the world's largest supplier of building materials, CEMEX. The author explains that one major issue was that of integrating joint ventures, the most common form of international expansion for CEMEX, and this involved integrating their own systems and culture into the new ventures. CEMEX's expansion into Spain, and the impact of globalization on the company are discussed. The role played by CEO Lorenzo Zambrano in orchestrating the organization's change from a national to an international and then to a global firm is described. The writer also discusses CEMEX's strategic application of knowledge management to transfer knowledge and competencies between their subsidiaries and their head office.

From the Paper:

"The expansion into Spain taught CEMEX some excellent lessons regarding international expansion via joint venture. They first learned a valuable lesson about the timing of such joint ventures, having purchased during an economic boom. In less developed markets, boom-bust cycles can be more pronounced and the Spanish market, coming off of decades of fascism, was no exception. As soon as the purchases were made, the Spanish economy and currency collapsed. Aside from the timing issue, CEMEX was forced to immediately enact organizational change in order to maintain profitability of the Spanish operations. They developed and refined their integration strategies, knowing that the future of the ventures depended upon them."

Sample of Sources Used:

• Miller, Robert; Glen, Jack; Jaspersen, Fred; Karmakolias, Yannis. (1997) International Joint Ventures in Developing Countries. Finance & Development, Vol34, Issue 1. . Retrieved October 7, 2008 from http://www.imf.org/external/pubs/ft/fandd/1997/03/pdf/miller.pdf
• Sveiby, Karl Erik. (1997). The New Organizational Wealth: Managing and Measuring Knowledge-Based Assets. Berrett-Koehler Publishers. Chapter 9, p.123.

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