Mobilizing our assets and capabilities towards becoming a truly global company requires us to leverage the knowledge created across the company and share it to innovate through replication and improvement. We created a collaboration model based on networks, enabling individuals' interaction regardless of position, location or function. Networks are geared towards strategic imperatives, functions, and common interests.
With headquarters in Monterrey, Mexico, CEMEX is a global building materials company with more than 40,000 employees spread in over 50 countries. There are more than 22 languages spoken across the CEMEX globe.
At CEMEX we make cement, aggregates and ready mix as our three main business lines. For more than 100 years, we have grown from a Northern Mexican cement plant to a global company. Most of our growth has taken place since the 1980’s through acquisitions. We are one of the three leading building materials companies in the world, competing mainly against Holcim and Lafarge.
CEMEX has grown mainly through acquisitions, and with each PMI, the company seeks to quickly assimilate the partner company while learning from its best practices and leveraging its talent. This represented an enormous challenge with the way we operated in the past.
As a building materials company, we do the same activities and produce in pretty much the same way in every location. Our processes are very similar and teams used to work in a very localized, independent fashion, with little interaction between operations. This generated silos and singular cultures, setting collaboration and knowledge-sharing aside.
Through the experience in PMI´s and Collaborative Teams in Europe, the company´s leadership soon realized the value of creating and enabling networks of experts to exchange ideas, practices, and knowledge and to bring them back to their home operations. This exchange of ideas could only take place in a limited manner through personal contact, but the company´s leadership knew that it could go far beyond this boundary and reach its full potential if only the networks would expand their reach on a global scale. The company decided to find a better way of ensuring that best practices were not just identified, codified and shared, but also consistently replicated across businesses and geographies.
This was not, however, without its challenges. First and foremost, this entailed radically changing the company´s culture, from a highly hierarchical and competitive environment to a more open and collaborative workspace, where knowledge sharing was encouraged and rewarded. Next we had to keep people participating and ensuring they remained motivated to contribute constantly and regularly to their networks. Our aim was for these interactions and knowledge sharing to lead to innovation.
Another challenge was the availability of technology. In the past, this level of global interaction between networks of experts was almost unheard of, because we did not have robust tools to link them efficiently and effectively. Today, with social networks we have made significant strides towards making this possible, and are constantly improving on the way we can collaborate and interact with each other.
When we first started creating these networks, we rallied groups around strategic initiatives that the Executive Committee had identified as those most likely to generate value for the company in the long term, and that had their executive support. These networks were formed with a formal leadership structure, which would pre-select and gather suggestions for network members and invite them to join the community and collaborate. They focus on topics that CEMEX considers strategic and with potential to generate significant value from the company. In fact, CEMEX executives expect breakthroughs from each one of them. They were the networks that would get this great experiment going.
At the same time, we opened the platform to everyone in the company, and they in turn started creating their own “organic” networks, around interests, and common issues. The way these communities were formed was from the ground up, where people with particular interests would create a community and share it with people they thought would be interested. Those who joined would share it with their networks, and so on. This way interest-based networks grew and prospered. These are the two kinds of networks that we started with - – Global Innovation Initiatives (formal, executive-led, and created) and Interest based.
We then started moving towards the creation of Functional networks, where experts on a single topic or function could get together and exchange ideas and best practices. The Innovation team started grouping all the Logistics people, and all the Human Resources people, etc. Although their functions were to some degree very local, they could lean on their colleagues across the globe for guidance and support, knowing that they all face similar challenges at their own posts. These communities were created through invitations and also through network member recommendations. In some cases, some headway had been made organically, in others, it was a blank slate, but the desired state is that all functional areas, and in fact all work should have a space at Shift. Working in networks makes sense in every area. For more information on the evolution of our Shift platform click here.
Members of these networks connect in several different ways, depending on location, work style, and community leadership. Some communities, which are highly disparate, work strictly online in the Shift platform through discussion boards, wikis, document sharing, etc. many others start out with a lot of videoconferences and move to the virtual space, ending up working mostly on the platform. Others make heavy use of web meetings, where several people are connected through voice and also share a screen to follow presentations and other visual aids on. Webcasts are largely used for formal presentations to large audiences, or even the whole company, these are Global Webcasts. Finally, most communities hold a reunion each year with 100-150 of their most active members discuss strategy, next steps, and other topics in a city that is most convenient for everyone. The beauty of these networks is that each member or each community has a vast array of options for connecting and is free to select the set of options that best adapts to their particular needs and work style.
All of these networks collaborate and share constantly, and this is how we ensure that the best practices being carried out in one operation do not remain isolated and unknown for long. These practices are documented and shared so others can replicate them. The networks develop toolkits (simple guides to get started) and are in constant contact with their colleagues. This is a powerful combination of instructions and access to experts in case questions or comments should arise.
A good example of this kind of collaboration is the Cement Operations Safety Community. Benito Flores and other colleagues who saw the value of sharing best practices to improve plant safety created it. They received guidance and onboarding from the Innovation team and from there grew the community to more than 900 in one month. The network quickly started sharing best practices to increase security and reduce job site accidents. Although most of the users did not spend their time in front of a computer, they used the time they got at the shared computer in the plant´s office to connect with colleagues and put what they learned into practice. In a year, accidents were reduced by 50%. The fact that peers could share their suggestions (without much intervention from management) and leave them for others to review at their own time, led to more people being able to replicate these best practices without the need for lengthy or standardized safety seminars of the past.
The Alternative Fuels community worked in a similar way. It was created as a Global Innovation Initiative, with formal leadership and invitational membership. However, as in the above organic example, the leaders of the community and the managers of those who were a part of it quickly saw the value in letting peers talk to peers and make suggestions without intervention of management “middle men”. They started sharing best practices on the use of Alternative Fuels across the globe and implementing them without the need to wait for a lengthy visit or a standardized directive from above. They could simply take from the community what they considered more appropriate for their particular needs and put it in practice. Soon the company became one of the leaders in the use of Alternative fuels, going from a substitution rate of around 5% to over 27% in just a few years.
The Cement Commercial Community noticed that the resources dedicated to IT were not being used efficiently, since each country had its own priorities and challenges that needed to be addresses and solved. They were basically solving the same problem in several different ways. They suggested that the company could extract the priority topics from the network to invest capital where it was most likely to maximize resources, with a single solution for global problems. This was not only very difficult to do without the network structure that is now in place, but also, this topic was traditionally outside of the scope of the Commercial Community, but with the new collaboration practices, openness and voice for everyone, the suggestion was taken seriously even though it did not come from the area in charge of this topic, breaking down functional boundaries.
Now we have no more need for lengthy visits and formal project teams to move all initiatives along. These networks will set things in motion to achieve the goals they set themselves to, while continuing to complete their regular tasks and with minimal investment in time and money. In fact, these networks were created to complement our organizational structure, without removing accountability on results away from the Business Units. These teams are just more agile and don´t have to be permanent or co-located to function. By letting them collaborate on a peer to peer basis, the networks have put more best practices in place, more quickly, and more successfully, than in the past.
After 5 years of working in an open, collaborative manner, we are moving from informal sharing (“I think this could be useful for you, it is at your discretion to use it”) to formal sharing- where the network agrees on the best way to do something and it becomes part of the company´s standard operating procedure, or a toolkit is developed and turned into policy. These practices are shared through a wiki in CEMEXpedia, where they can be updated, improved upon, or challenged, so that they never become static paradigms.
The networks have enabled our company to improve the bottom line and generate innovation not only in terms of new products, but also in reproducing what was successful in one, or a few operations, across the company.
The first and most important challenge was changing the company´s culture. CEMEX has always been innovative and followed the latest management and technology trends, but its culture has historically remained hierarchical, and competitive. The creation of these networks required people to change from this closed mindset and become open to a more collaborative approach to work.
It was hard to get people to realize that they could express their opinions freely, even if they were different from those of the company´s executive team, but slowly, through a lot of communications and a strong change management strategy, the Innovation team slowly started changing the way people interacted and portrayed themselves in the network. The team also enlisted the support of the company´s Executive Committee so that they themselves could start setting examples of meaningful and rich conversations taking place within the networks without regard to position in the company. By setting an example and a kind of laboratory within the Innovation team and with close ties to the company´s leadership, heavily sharing success cases and examples, the team has had a good level of progress in making CEMEX a more open and collaborative company than it was five years ago.
Today, Jaime Elizondo and Karl Watson, some of the company´s top executives are two examples of leading by example. They have leveraged the network to get closer to their teams, breaking the barriers of contact. Jaime constantly invites people to engage him personally, providing his direct contact so that people can reach him easily. Carl Watson does the same and personally supervises several important projects, such as a Global Pilot in Poland, putting himself closer to our operations. Other executives use forums like “Concrete Talks” where each country shows, in video format, their strategy with Ready Mix, what they did, what they learned, etc. In this media it is usually the Country Presidents or the experts in Concrete who make the presentations and answer questions from their audience.
Another challenge was mediating the interests, needs, and motivations of a very diverse workforce in terms of generations and cultures across the company. At CEMEX there are over 22 different languages spoken, and we have representatives from many generations, from baby boomers to generation Y. This represents a vast difference in value system, work ethic, education, technology savvy, and personal goals.
To address this, the team generated and studied a series of profiles of different groups of people and developed communications and onboarding strategies geared specifically for each. For instance, the team created a reverse mentoring program so that the younger members of the team (usually in more junior positions) could mentor higher-ranking executives (usually less comfortable with emerging technology) on savvy use of social media and the innovation platform. This way both parts benefited from the exchange in learning from the skills and experience of each other. For younger users, the availability of a “self-help” helpdesk was a reflection of ongoing tech trends that they have now grown used to in the www age. These different approaches made implementation a little more complicated and segmented, but ensured that each audience had enough information and encouragement to join in and contribute to a network they felt drawn to.
Furthermore, even though there were successful communications and change management campaigns, as in every effort, there are several skeptics that will draw people away from the goal if they are allowed to run free. This risk was mitigated through heavy executive support and massive showing of proven success cases in every area of the company. Where someone could say, “That may work for them, but it won´t work for me” the Innovation team usually had a strong example to counter this opinion and demonstrate the universal value of creating networks to share knowledge and leverage it.
One such challenge was showing some executives that spending time in the Shift platform was actually work. Some still perceived social networks as a waste of time that people do in their idle time, not at actual work. Those who understood the value of networking and collaboration for innovation had to make a point of demonstrating that networking was actual work. This was slowly achieved by the constant publication of success cases with actual figures and statistics, from the networks, but most importantly, from actual word of mouth and leadership by example from the executive committee. Now some of the initial skeptics have become champions.
The technological challenges were fewer in this case, but there were still some areas to improve upon, and through the creation of a user friendly help center and feedback mechanism, improvements could be made according to what users wanted, and could be done quickly too. Other technological issues were the worry about information security, which was rapidly put to rest by explaining the benefits and smaller risks of cloud computing and using the usual security protocols the company already had in place, and proved to work.
Networking has brought a series of benefits to CEMEX, the most important is leveraging the best of CEMEX talent towards innovative initiatives that generate value for the company in the short and long term.
Employees all across the company can now link with experts in any topic to tap their knowledge to improve their own performance at home and as a team. By enabling employees to contact their networks directly they can easily seek support in any endeavor and also make their ideas visible to anyone with a common interest, regardless of position or location. As Maria Luisa Porras puts it, “The network that has been created through Shift is, I think, the most valuable aspect.”
Networks have grown and expanded throughout the company in the past 4 years. Participation in the networks has almost doubled since last year, as measured by the amount of logins registered in the platform, and the networks continue to grow. Several networks now have more than 1000 members, and many more have hundreds of members. When we started in 2009, we created 7 Global Initiatives, those have now been brought together and transformed into 6, but they encompass many more topics of interest than those in the past. Outside of these we have 15 functional networks (Logistics, Finance, Human Resources, etc.) and over 2000 organic self-organized networks.
The company in turn has seen improved year-end results. Of course these numbers are the result of the hard work, collaboration and commitment of all CEMEX employees across the globe in each of their functions and we can´t measure exactly what part of this success the Networks have played, but we can look to the achievements of each individual network and take note of the measured benefits that this new way of working has brought.
The Alternative Fuels initiative, now part of the Cement Operations Network, has yielded impressive results. In less than 6 years, CEMEX has become a leader in alternative fuel substitution in the industry. Thanks to the network´s collaboration, the company´s substitution level has gone from 5-7% in 2005 to 25-27% today. This has brought up to $135 million dollars in savings in 2013 and a reduction of 1.5 million tons of CO2 released to the atmosphere every year. This has also earned CEMEX the CemFuels Prize two years in a row.
The Ready Mix network has also achieved great things. They have created a Global Product Catalogue where the vast variety of Value Added Products are listed along with their specifications, marketing strategies, brand management information, and any other relevant data related to them. They also created a Value Added Products Performance Dashboard to monitor the profitability and sales of Ready Mix Products.
Furthermore, they have created 3 global brands for CEMEX, Promptis, Insularis, and Hydratium. This is an unprecedented action in this industry due to the highly localized nature of the inputs in the industry. However, through working together as a network and figuring out what each operation could and could not do, these products are now available to all CEMEX customers worldwide. All of these innovations have led to Increased sales of value added products from 8.5% in 2006 to 33% 2013.
Another good example of a network generating value is the Grow the Pie initiative. They have developed new marketing avenues for Pavements and Housing Solutions, reaching over 300 paving projects in the past year. They too have built a catalogue of infrastructure projects and actively promote their products internally and externally.
As we have mentioned in several statements above, top management support and backing have been some of the most important factors in the success of this endeavor, so the most important thing to do before getting started is to reduce the Top Management Fear Factor. When proposing something as radically new and disruptive as this network scheme was, a team must support it with solid methodologies and proven advantages so that the top executives will easily get behind the idea and lend their reputation to make it grow. In this case, the potential value of innovating through replication was clear. For instance, with the Alternative Fuels initiative, which had been running before Shift started working, if one plant achieved $1M in savings per year through the use of Alternative Fuels, what would it be like if 20 plants achieved this? How about 50? How about 100? This made for a strong case for achievable potential benefits, vs. a low initial investment.
It is also important to develop a clear strategy from the begging of the transformation project so that you can build upon a solid base. However this strategy must be continually revised and revisited to update and check results, and make changes accordingly if needed. If your plan is OK you can go forward with it, but always allow for it to change so that the maximum benefits can be achieved. For example, what started with Global Innovation Initiatives has evolved to Global Networks, with a regrouping of priority areas of focus, and a few changes on what the company will bet on for the future.
A cultural change is fundamentally of people, so be sure to engage the right people and make them your allies and strategic partners. They will help you effectively share your ideas and ensure the success of the endeavor. Stakeholders such as Human Resources, Communication, and IT are a great support network to work with, but be sure to include them since the beginning so that they feel they have a strong participation and opinion in what is being carried out. This way, they feel the project is more their “own” and strengthen their commitment. For instance, the Innovation team aimed for the company to embrace “Leveraging a Global CEMEX”, a program that formalizes the networks created and nurtured through these new practices, and they involved Human Resources, Communication, and IT, and they now own this idea and they are taking it to the next level.
Although the networks are being formed and interact in a technological platform, keep in mind that behind each comment, post, video, or webcast, there are people working towards a common goal. Keeping human interaction alive and well is a strong component of creating lasting bonds within the network. Start interacting on the technological platform, but don´t forget to do so on a more personal level too at some point. For example, the UK team has connected on a more personal level through a pedometer challenge. They aim to collectively count the steps they walk and count how many times they walk around the globe. Jesus Gonzalez, the Country President, is actively participating, and his team is called “Speedy Gonzalez”. All teams share their progress and challenges on a community and this enables them to make more personal connections and collaborate more informally, making them more comfortable in interacting with each other in other endeavors.
Constantly measure success and detect opportunities to make changes in the model. If you can understand where the most important strides have taken place and where the gaps still remain, it is easier to trace a course towards success and real transformation. The model must not be static or rigid, but rather flexible and malleable to what your organization needs. The Innovation team is constantly visiting the feedback spaces provided in the platform and making changes accordingly. They also review the platform´s metrics and analytics to identify areas of opportunity that they can help mobilize towards increased participation.