Desklib: Examining Effective CSR Strategies and Analyzing CEMEX's Success in Mexico and Blockbuster's Failure Using Disruptive Innovation Theory

This article discusses effective CSR strategies using Porter and Kramer's CSV framework and analyzes CEMEX's success in Mexico and Blockbuster's failure using Christensen's theory of disruptive innovation. It also covers the challenges faced by CEMEX and how it overcame them to expand its operation globally.

BUSINESS STRATEGY
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TABLE OF CONTENTS
SECTION A...................................................................................................................................3
1.Porter and Kramer (2006) state that effective CSR initiatives occur when shared value is
created effective Netflix are reviewing their CSR strategy.........................................................3
SECTION B....................................................................................................................................5
2. CEMEX’s continuing success in Mexico has been the result of the ownership of a chain of
CEMENT and Concrete production facilities..............................................................................5
3. Blockbuster’s failure in 2010, analysis using theory of disruptive innovation......................7
REFERENCES............................................................................................................................11
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SECTION A
1.Porter and Kramer (2006) state that effective CSR initiatives occur when shared value
is created effective Netflix are reviewing their CSR strategy
Corporate strategy can be defined as set of action that are undertaken by company to
provide benefits to people living within society through doing charity, making optimum
utilisation of available resources and many more. As per the CSR concept company participate
in different market with an motivate to create social an economic value. So, Porter and Kramer’s
specified that the effective CSR initiative only happen when the shared value is being created by
company. Netflix is taking steps to review its CSR strategies. In another words, policies and
operating practices adapted by the organisation to enhance its competitiveness, and advancing
the economic and social condition is necessary (Pradhan and et.al., 2021). Hence, shared value
creation focuses on expanding and identifying the connection between social and economic
progress. Furthermore, it specified that there are three ways in which the shared value is being
created such as redefining the productivity in value chain, reconceiving products and market and
enabling the local cluster development. But the ultimate aim of the organisation is to earn high
profit margin through satisfying the wants of customers in effective manner, Netflix already have
good shared value in market. Thus, it can easily attract large number of people in limited time
frame for its growth and expansion. Therefore, Porter and Kramer’s CSV framework can be
used to critically analysis whether any of these initiatives should continue or adapt by Netflix or
not. Such as:
 Redefining the productivity in value chain: It argued that firm supply chain is exposed
to numerous issues such as health and safety, workplace conditions and use of resources
those results in adding cost to company value chain. Hence, firm must provide good
working condition and wages to employees, making optimum use of available resources
in order to reduce wastage within the society, provide suggestion to suppliers to improve
production and more.
 Reconceiving products and market: Porter and Kramer’s states that there are too many
companies that have forget to focusing on whether the products are good for the
customers or not. So, it emphasis that the rise of demand of products and services with
clear social value should be introduced by company (Moon and Parc, 2019). For
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examples: offer nutritional food to customers rather than junk food, limiting the use of
electricity through using digital intelligence technology and many more.
 Enabling the local cluster development: Thirdly as per the author companies also need
to focus on alleviating the social problems in the communities where it operates its
functions while enhancing its own competitiveness. As it is responsibility of company to
give back to society.
 So, on the basis of the framework, it can be evaluated that the company should continue
its involvement in Dimpact collaboration lead by the University of Bristol. As the aim of
the researchers is an online tool that calculates the carbon emissions of the delivery
digital media content. This will helps in reducing overall pollution release in environment
that adversely impact large number of people life (Karyawati and et.al., 2018.). Through
taking CSR activities as researching on carbon emission realise it can find out necessary
strategy to overcome the same. This will results in increasing overall market share of
company as people will happy that it is concerned about their health and well being.
 At the same time, making a new series of with David Attenborough on “Our Planet” by
Netflix is also good CSR initiative as this will helps in alerting a global audience to the
impact of climate change on wildlife. In another words, Netflix by investing in such
activity can make people informed towards the importance of planet, the ways in which
environment can be kept safe and secure and many more. But the key issue in this
initiatve is that company is laying more emphasis on realise the new series of popular
shows such as Stranger Things, Queen’s Gambit and Bridgerton. So, it must ensure that
the series of our planet must be made in proper manner to educate people to conserve the
same for current and future generation (Håkanson, 2020).
 Research has help in finding out that lot of carbon emissions being generated in film
production so scheme is to replace all on-set diesel generators with batteries and solar
panels. As in recent scenario, customers are more concerned about the environment, at
the same time it lead in attracting government grants and potentially tax rebates and
responsible for sixth of Netflix’ film production carbon footprint. Therefore, Netflix must
engage itself in making use of batteries and solar panels as it produces number of series
that are watched by large number of youth population.
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 On the contrary hand, it is not much compulsory for the firm to take initiative in
Supporting Wildlife Works that is non profit organisation wants to create market based
solutions for wide life conservation. The project will contribute in protecting a migration
corridor for elephants and other animals in Rukinga, Kenya. But the overall cost will be
more as compared to the profit or return gained through CSR activities. Furthermore,
Porter and Kramer has also clarified that shared value focuses companies on the right
kind of profits—profits that create societal benefits rather than diminish them. Hence, if
company will invest in this project then it will earn profit but will be less compared to
other CSR activities.
As per the Porter and Kramer’s CSR framework, Netflix out of four CSR initiate must
focus on making use of batteries and solar panels instead of on-set diesel generators, to
reduce the carbon emission. Then, it has to focus on making new series on “Our Planet” in
order to generate awareness among people about the increasing impact of climate change on
wildlife and necessary steps that they must intake to protect the same. After that making itself
involved in the Dimpact collaboration lead by the University of Bristol would be helpful for
the organisation as it will lead in increasing overall brand image of firm.
SECTION B
2. CEMEX’s continuing success in Mexico has been the result of the ownership of a
chain of CEMENT and Concrete production facilities.
that the In early 1900, CEMEX’s is global building materials company founded in
Mexico serving low-income population, encouraging innovative and creative and sustainability.
The company is facing tough competition in its home market in order to become innovative
publicly-traded global leader during 25 years. There are various challenges that act as barriers in
effective operation of company such as recessions, high debt, anti-dumping penalties and anti-
dumping penalties. But the company have idea related to the way all these challenges can be
overcome and it can promote smooth operation in external environment. CEMEX’ has gained
continuing success in Mexico through combination of “ruthless operating efficiency that is
innovation in new capabilities, relationship to raise capital at low rates and growing global
presence (McGrath, Kayser and Dalsace, 2021). Therefore, this strategy has helped in CEMEX
in foothold in every continent that is in more than 50 countries. While at the same time, the
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factor that hinders growth of organisation is that 50% of its revenue comes from both North
America and 50% from other parts of the world.
Yes, it can be stated that the success of CEMEX’ is results of ownership of a chain of
CEMENT and Concrete production facilities by the organisation. Such as Cement, a $400 billion
jackpot has achieved tremendous growth in few years that is; demand has doubled between 2002
and 2011 in order to reach 3,577 million metric tons. The demand of cement has been increased
mainly because of housing and infrastructure needs as there are many people that have started
making their own home to live. Furthermore, the global market of cement is being shared by few
dominant players that have helped them in enjoying huge amount of profit margin by meeting
the expectancy of customers in effective manner. Likewise, it has been estimated market size of
cement will reach by $395bn in 2017 but it have reach $682bn at a CAGR of 7.8% by 2025.
In 1989, the success of CEMEX has started when the firm has decided to acquire Tolteca,
which was its main competitor in Mexico. Then it has decided to expand its operation in Spain
1992, Venezuela 1994 and Colombia and Indonesia. The above statement that CEMEX has
achieved success because of ownership of a chain of CEMENT and Concrete production
facilities can also be explained through that it focus on “value before volume”. This is best things
that have lead in enhancing market share of organisation as it helps in understanding gap
between the current capabilities and potential that company have to capture market. In addition
to this, As per the recent review, company have third position in worldwide in terms of
production capabilities (Ekinci, Kazancoglu and Mangla, 2020). Hence, it has necessary
facilities, resources and equipment to manufacture cement that should be delivered to customers
in making their homes. Moreover, it is fifth by revenue, topped in North America by CRH but
first in the region by revenue so it represent that company have huge production capacity to meet
demand of range of customers in limited time frame.
On the other hand there are many companies that are facing hard time in cement industry
but CEMEX through differentiate, taking ownership of cement and its production is able to make
people happy and satisfied. Likewise China produces around 60% of world cement but
government has restricted the expansion of capacity on different industry construction materials
and destroying any excess production and many more. Chinese cement producer are 10 locals
alone that have capability or close to top 10 global companies by revenue so it acts as threat on
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smooth operation of business. So, the CEMEX has to manage both competition as well as level
of debt in order to grow and continue its operation for many years. Company capability that is
ownership of a chain and Concrete production facilities has helped in expanding its operation in
different parts of the world to enjoy high profit margin. Apart from this, there are range of
factors that has lead in growth of organisation in local and international market such as
innovating in new solutions, downstream vertical integration and strong value chain (Teoh and
et.al., 2019). Such as CEMEX has emphasis on finding out new and innovative method of
building homes so that people have peaceful space to live and enjoy their lifestyle. For examples:
modular construction and ready to assemble elements and prefabricated are various options that
has been provided by the company to its customers. Furthermore, it has strong and effective
infrastructure and housing construction that has helped company in gaining and retaining
competitive advantages for many years.
Secondary research has helped in learning that cement production capacity of 93.7
million metric tons that has put it as third largest production cement across worldwide. It was
the first firm to implement the art logistics and technology platforms that has helped in creating
brand image in mind of customers as “digital leader’. Company has make use of innovative
technology to delivered qualitative experience to customers that has helped in improving the
reputation of firm in external environment. In addition to this it is vertically integrated company
that follow process such as sourcing of materials manufacture into the product and eventual
distribution via land or sea so that it can reach the desired customers in limited time frame (Buira
and et.al., 2021). It also have Cement and other building materials that are low value to weight
ratio for examples the location of miles within several hundred miles of the end consumer.
Hence, both the ownership of chain and production capacity has lead in expansion and growth of
organisation at both domestically and internationally.
3. Blockbuster’s failure in 2010, analysis using theory of disruptive innovation
Blockbuster owned over 9000 video rental stores in US, and had been filed for
bankruptcy in 2010, with almost $1 billion in debt because it failed to keep up with competition
among rising industry scenarios. The competitors were rising variedly, where company working
strategies were not innovative and lacked efficiency to cope up with creative functional
efficiency. Blockbuster seemed decline in customers bookings, where the services in form of
brick and mortar film rental model were highly becoming obsolete. The company started to loose
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revenue and popularity aspects among people, where it hampered business goals functionally
within longer time frame productively. It can be also analysed that company business services
were not uniformly aligned with significant working scenarios, based on specific keen functional
vision and harnessed environment scenarios . Within year 2010, blockbuster went bankrupt and
dish network bough, where it tried similar things integrating with satellite services but it seemed
basically bringing rapid change within mechanism. The company had been lacking creativity and
innovation for fastening its services within larger horizons, where customers optimum standards
were not evolving rapidly towards functional pace (Quansah, Hartz and Salipante, 2022).
It was also analysed that Blockbuster also faced huge competition from Netflix, business
engagement was rising by bringing in various new online services for extended customers
market share rapidly. The company business strategies were becoming obsolete , fundamental
decline in business being witnessed within services and customers decline in goodwill
parameters. Blockbuster also faced huge decline in customers networks, wider range technical
vision being lost up and leadership of innovation being less persuasive for bringing change
productively. It was analysed that Christensen’s theory of disruptive innovation, explains
phenomenon by which innovation has to be developed for transforming existing market and
sector by bringing best convenience. The theory also addresses specific focus on accessibility,
and affordability factors where complications and high cost are status quo (Tripathi, 2022). It
signifies that usage of christensen’s theory for disruptive innovation signifies that major
parameters have to be worked on, towards building new services as Blockbuster was lacking
innovation. The usage of disruptive innovation, in transforming new business ideas and rapid
diversification plays crucial role for strengthened functional growth diversely and generate best
technical standards.
Blockbuster has been lacking fundamental long term focus for enhancing innovation
approaches, and was lacking usage of multimedia platforms usage for engaging towards wider
needs among customers (Rickley and Stackhouse, 2022). It can be also analysed that technical
potential goals developing towards productive working vision correlates, towards log term
innovation platforms reach. As per detailed analysis. Blockbuster was having stiff competition
from Netflix and there was rising competition levels, where this hampered technical long term
stability within business ideas. It can be also analysed that by undertaking the practical usage of
disruptive innovation, new ideas and specific rise on extended customers market base needs can
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be evolved on for gaining practical approaches. Therefore, company has been witnessing huge
scale decline due to lack of innovation, digital services being offered and wider strengthened
optimisation lacking for integrating competencies variedly. This can be also analysed that
Blockbuster lower integration of new technologies and vision orie3nted expansion,
fundamentally holds huge importance for strengthening competitive market stability and engage
on towards new market needs.
It can be analysed that Blockbuster mechanism for services delivery were less innovative,
less competitive towards market oriented diversification and detrimentally lacking vision for
gaining customers goodwill. There has been also less focus evolving, towards mew emerging
trends and innovative goals competent use, which further lowered vision development. The
company has been lacking leadership for innovation to diversify and generate optimum revenue
and profitability grounds diversely, which hampered business productivity in longer time frame.
This signifies that disruptive innovation theory holds huge importance for harnessing productive
vision growth, higher engagement based services as per convenience and towards gaining
productive output. Blockbuster decline is due to less competencies to deal with competitive
nature, less innovative mechanisms and harnessed lack of vision oriented goals for serving new
products. Netflix on other hand, has been productively expanding new market base for bringing
customers best scale digital services and technically improvise faster customers satisfaction
(Pöyhtäri, 2019). There has been varied expansion towards working optimisation, where latest
new determined pace within companies faster technical approaches have to be worked on. Role
of disruptive innovation holds huge scope for leveraged fundamental benchmarks and gaining
stronger quality results productively.
The Blockbuster was unable to further develop new rapport with changing customers
demands and built up innovation creatively, which lowered determined technical efficiency.
Company has been witnessing huge decline in customer market base and commercial strategies
being implemented, where this hampers long term market stability for corporate growth
significantly. This also determines the best determined market base to be worked on, where
Blockbuster slow creativity and less productive vision has lowered connective market base.
Netflix and other competitors are widely expanding, for gaining new quest growth among wider
extended technical determined pace rapidly. This primitively holds huge scope, for company to
retain new competent scope worked on and also leveraged decline within output aspects.
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Blockbuster has been also witnessing hug complexity, decline in revenue standards and practical
outputs where this has hampered long term retaining vision for extended improvement working
(Popescu, 2022).
Company has to further evolve on new disruptive innovation, bring on creative factors
and diversify specific scale competent vision for engaging towards derived competition. Theory
of disruptive innovation, has to be worked on for engaging towards wider scale growth based on
working towards quest growth for extended technical strengthened vision. There has to be also
derived growth worked on, for larger scale technical optimisation and gain vision towards quest
enhancement where Blockbuster has to further optimise new goals. The company has to deliver
best scale goals., and gain productive quest paradigms towards deriving extensive new scale
expansion for primitive new engagement. Blockbuster has to further adhere towards new scale
growth, where there has to be also new expansion worked on for gaining stronger vision and
also bring new technologies in pace.
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REFERENCES
Books and Journals
Buira, D and et.al., 2021. A whole-economy Deep Decarbonization Pathway for Mexico. Energy
Strategy Reviews, 33. p.100578.
Ekinci, E., Kazancoglu, Y. and Mangla, S.K., 2020. Using system dynamics to assess the
environmental management of cement industry in streaming data context. Science of the
Total Environment, 715. p.136948.
Håkanson, L.,2020. Multinational Enterprises use of CSR as a Competitive Advantage.
Karyawati, G and et.al., 2018. The complexity of relationship between corporate social
responsibility (CSR) and financial performance. EMAJ: Emerging Markets
Journal, 8(2). pp.19-25.
McGrath, L.K., Kayser, O. and Dalsace, F., 2021. Mindset drives success: Selling beneficial
products at the base of the pyramid. Business Horizons.
Moon, H.C. and Parc, J., 2019. Shifting corporate social responsibility to corporate social
opportunity through creating shared value. Strategic change, 28(2). pp.115-122.
Popescu, C. R.G., 2022. Fostering Creativity in Business: Empowering Strong Transformational
Leaders. In Handbook of Research on Changing Dynamics in Responsible and
Sustainable Business in the Post-COVID-19 Era (pp. 349-381). IGI Global.
Pöyhtäri, J.P., 2019. The role of internationalization consultancy in SME internationalization.
Pradhan, S and et.al., 2021. Corporate social responsibility and employee volunteerism: A broad
overview of CSR through volunteerism. Sustainable Branding, pp.99-112.
Quansah, E., Hartz, D.E. and Salipante, P., 2022. Adaptive practices in SMEs: leveraging
dynamic capabilities for strategic adaptation. Journal of Small Business and
Enterprise Development.
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Rickley, M. and Stackhouse, M., 2022. Global leadership effectiveness: A multilevel review and
exploration of the construct domain. Advances in global leadership.
Teoh, M and et.al., 2019, April. Managed pressure cementing mpc within a narrow pressure
window, deepwater gulf of Mexico application. In IADC/SPE Managed Pressure
Drilling and Underbalanced Operations Conference and Exhibition. OnePetro.
Tripathi, D., 2022. Evaluating the factors influencing Alignment of IT and Business in a Cloud
Computing Environment. Journal of International Technology and Information
Management, 30(5), pp.29-76.
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