Building materials’ company CEMEX has a vision to become the BEST for all of its stakeholders and has a strategy in place aimed at delivering just that.
In the UK CEMEX supplies concrete, cement and aggregates, as well as asphalt, building products and mortar. Its Paving Solutions business specialises in constructing roads using both asphalt and cementitious materials.
The business generates £775 million in annual sales, employs a total of 3,000 people in the UK and is part of the global group CEMEX which is headquartered in Mexico. CEMEX gained its foothold in the UK when it acquired RMC in 2005.
Lex Russell is Vice-President of Aggregates and Asphalt in the UK responsible for 1,040 employees serving in the region of 2,000 customers and currently producing some 20 million tonnes of aggregates and 2 million tonnes of asphalt a year.
The recent economic crisis and continuing tough economic climate has had an impact on the UK business with the decline in the construction industry meaning less demand for CEMEX products.
“Times have been very hard for us. In 2007 we were selling 26 million tonnes of aggregates, but that dropped by around 30 percent; but now we are starting to climb back up with current sales of 20 million tonnes,” explained Russell.
A question of costs
CEMEX is also striving to reduce operating costs in order to improve its returns. In a bid to counteract the economic conditions CEMEX has placed a strong focus on continuous improvement and its quest of becoming the most efficient aggregates operator in the industry, but estimates it is currently undervaluing its products by 30 percent in the market.
Russell said: “The last couple of years we have been concentrating on reducing our costs, but it is getting to the point where we need to increase our selling price in order to recover our costs and be able to invest in the future. We are committed to giving our customers the best quality products with the best customer service. We strive to create value for our customers. But this can only be achieved by investment in reserves and modern production plant and equipment for the future.”
To this end, the award-winning company has launched initiatives aimed at improving standards in just about everything it does. It has five major stakeholder groups where the company is primarily focused, namely: families, customers, employees, communities and shareholders.
Best for families
Families, referring to CEMEX’s workforce, is a particular area of pride for the company. “Being the best for families is about health and safety and the wellbeing of our people and ensuring everyone goes home safely each night,” Russell said. “Work related incidents are without a doubt preventable; our aim is to achieve zero lost time injuries and we are confident that this can be achieved.”
Probably the highlight of last year was winning the MPA Health & Safety Award, the John Crabbe Memorial trophy for outstanding excellence in health and safety.
“It was a very proud moment for me when our Country President, Jesus Gonzalez, went forward to accept this trophy on behalf of CEMEX UK,” said Russell.
“We have won many awards in the past, but I think this award recognised the progress that we have made and our strong performance in health and safety including the initiatives we have launched and the culture we have established in the business.”
Each year the company runs its own health and safety workshops which every employee is encouraged to attend, along with the Health and Safety Executive (HSE), competitors, customers and contractors. The most recent campaign was the most comprehensive training programme undertaken so far, with a focus on educating employees to take responsibility not only for themselves but for colleagues, contractors and visitors and also not walking past and ignoring unsafe practices or potential hazards, but acting on them.
Russell said: “The programme consisted of 17 day-sessions and involved theatre-style presentations with actors imitating unsafe practices within the workplace, starting with a situation as the attendees walked in to the event. It provided a great starting point and made for really strong interactive sessions.”
CEMEX operates a comprehensive national supply network to ensure that quality materials and services are available to customers locally, and maintains a significant logistics fleet of aggregate tippers, cement tankers and concrete mixers.
Safety on the roads is a big issue and one that is taken very seriously by the company, in particular making sure its drivers are aware of vulnerable road users such as cyclists.
Russell said: “We have been doing a lot of work to make our own vehicles safer by fitting additional safety features such as mirrors, proximity sensors and cameras, as well as working alongside the police and cycling groups to educate cyclists about the potential dangers around large vehicles.
Best for customers
The aggregates business supplies all the major construction companies and many smaller businesses throughout the UK, and Hunter Russell is keen to point out that after health and safety it is the firm’s number one priority.
He said: “Customer service has gone through a transformation as it is something we are all very passionate about improving. The customer service promise issued to all our customers underpins our aims. Firstly it says that ‘if we can’t deal with your enquiry immediately, then we will get back to you within 24 hours latest.’ This is not just about responsiveness, it’s about the manner in which we respond and understanding our customers’ requirements.
“One hundred percent of our products meet or exceed relevant quality standards: we continually invest in developing our services and solutions to deliver optimum performance. If our quality checks highlight any deviations we will contact our customers in advance.
“We always aim to deliver within the agreed timeframe – and if there is a problem we will call you. We realise how important on-time deliveries are to our customers, we set ourselves high targets but when issues occur then timely communication is key.
“One hundred percent of issues or complaints will be dealt with within 24 hours. Of course, nobody wants problems but when they occur we try to resolve them swiftly, accurately and comprehensively.”
The company measures its customer service performance weekly and it is discussed at all levels in the business.
“If you can’t measure it you can’t manage it,” said Hunter Russell. “Every Monday the UK management team meet with our Country President to discuss how we have performed in the previous week and what we need to do to improve going forward.”
To ensure customer service is part of CEMEX DNA, there are some 200 advocates taken from all different levels of the business who meet regularly to identify ways of making improvements, implementing them and ensuring they are passed on to every employee.
“Everyone in the company serves a ‘customer’; they may be internal colleagues but we should all offer the same standard of high customer service,” Russell explained.
Best for employees
CEMEX employs a wide variety of skills including electrical and mechanical engineers, geologists, quarry managers, commercial sales specialists and drivers.
Many of those loyal workers have been with the company for years, but that in itself has posed something of a challenge for the company where the average age of an employee is now 48 years old, which is reflective of the industry as a whole.
“It is great that we have that kind of loyalty and engagement however we do need to attract younger people into CEMEX as well as developing the talents of our younger colleagues,” said Russell.
The recently introduced Leaders in Development programme seeks out talent from within and puts candidates through a year’s training which enables them to experience all areas of the business, after which they are offered a position within the company.”
CEMEX had an impressive 18,000 training interventions last year, amounting to an average of six training sessions per employee. The company aims to train and develop all staff, with Operational Managers and Supervisors taught the principles of continuous improvement.
Every commercial employee experiences the CEMEX Commercial Academy, fostering industry knowledge and a desire to always build on success.
“It is important that we have sales people who understand the true value of our products and can effectively communicate this to our customers. All of our operators are trained to a level of competence and we are about to commence our weighbridge development program,” said Russell.
Being the best for communities
With some 56 quarries located around the UK, CEMEX plays a leading role in working closely with the communities and environments that it operates in.
“We do a lot of excellent quarry restorations, when we have finished operating quarries the finished site is restored to a better environment that when we started,” said Russell.
The company has created many bio-diverse environments including a nature reserve in Nottinghamshire which has been endorsed by broadcaster and naturalist David Attenborough and won many awards.
CEMEX Rugeley Quarry was the first ever winner of the Natural England Biodiversity Award for its restoration and creation of 80 hectares of wildlife habitat at the site.
The Company’s ‘Lend a Hand’ Project also encourages employees to roll up their sleeves and get involved with their own communities in myriad charitable projects.
Senior management have also recently been involved cleaning up in the community of Ferriby that was devastated by flood damage. Prior to this they visited a children’s hospice and carried out building and maintenance work
All these valuable experiences not only positively support the local communities, but provide a good team building experience for staff.
Best for shareholders
Last, but by no means least of the stakeholders, is the shareholders, who Hunter Russell admits deserve to reap the benefits of their patience. “The truth is that we do not give them an acceptable return on their investment,” he said.
“The UK aggregates industry is essential to the economy and our way of life. Our products are what builds roads, houses, schools and hospitals and are essential in the construction of generating facilities for energy and management of water. We need to have a sustainable aggregates industry to safeguard this valuable resource for future generations.”
CEMEX spends millions of pounds on all manner of things such as £10m on archaeology unearthing important historical artefacts and £150,000 on protecting a newt colony. Planning fees alone were £1.5million last year just to maintain their current reserves. The cost of restoration is frightening on an annual basis.
Russell explained CEMEX’s strategy to become more profitable: “We have analysed every one of our quarries in the UK and we know where our prices need to be to achieve our full cost recovery,” he said. “We have a price roadmap in place setting out where we need to be and how we will get there.
“The geology of the UK dictates that not all areas or quarries are the same, but generally we are under valuing our product by around 30 percent. I have been in this industry for nearly 30 years and I feel responsible, but I am fully committed in the coming years to supporting our customers, ensuring their competitiveness, and ultimately achieving prices which will allow us to sustain and grow our business.”