CEMEX: Information Technology, an Enabler for Building the Future

Abstract

The case examines the role of IT in CEMEX, a giant Mexican building materials manufacturer in an industry categorized by low margins and high costs. In the early 1990s, CEMEX made significant investments in its IT systems, resulting in a data-based management operation that put it at the forefront of the industry. As the company grew through acquisitions, it integrated IT through “The CEMEX Way,” a set of standardized processes, organizations, and systems implemented on a common IT platform.

In 2007, when CEMEX acquired Rinker, a major Australian concrete company, aligning Rinker with CEMEX IT systems was critical to quickly streamline operations and realize efficiencies. The CIO of CEMEX had developed a new integration process called Processes & IT (P&IT) that he was considering using for the Rinker integration. However, P&IT required additional resources, including significant upfront fixed costs and investment in new personnel teams at a time when the company was already struggling with the integration of another acquisition. CEMEX could either align Rinker to The CEMEX Way or use the opportunity to invest significantly more in evolving to the new P&IT approach that focused on business process management.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

2024 Sage Publications, Inc. All Rights Reserved

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Resources

Exhibit 1: CEMEX Way Focal Points

Figure

Source: CEMEX company information.

Exhibit 2: CEMEX Key Figures in 2007 (after acquiring Rinker)

Revenues 2007

$21.7 billion

Net profit 2007

$2.6 billion

Number of employees

67,000

Countries of operation

over 50

Aggregate quarries

400

Cement plants

66

Ready-mix plants

2,000

Source: Go India; Into the CEMEX Womb; C-Suite Leadership, December 2008.

Exhibit 3: CEMEX Revenues (including Rinker in 2007)

Figure

Source: Go India; Into the CEMEX Womb; C-Suite Leadership, December 2008.

Exhibit 4: Degrees of Integration/Organizational Standardization in the New Model

Figure

Source: CEMEX company information.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

2024 Sage Publications, Inc. All Rights Reserved

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