CEMEX, Green House

GREEN HOUSE CEMEX FINAL REPORT BORBOLLA + CASULLO + DE VREE + GA RCIA + HOSFORD + SLOTS

POLE PROJECT / 2016

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GREEN HOUSE THE RIGHT WAY CEMEX FINAL REPORT

TEAM BATTISTA CAPRONI BORBOLLA + CASULLO + DE VREE + GARCIA + HOSFORD + SLOTS

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INDEX

6 9 12 INTRODUCTION

PROBLEM STATEMENT

PROP

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POSAL

26 28 COMMUNICATION

CONCLUSION

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INTRODUCTION

The concrete industry has seen the introduction of a wide variety of innovative concretes. However, the construction industry is very conservative and slow to adopt new building materials. We believe that CEMEX must invest in innovative technologies beyond building materials in order to maintain market leadership. New energy requirements, urban gardening concepts, and ecological responsibilities challenge the traditional palette of CEMEX’s products.

It is important to allow potential customers to experience the qualities of this versatile material. Therefore, new visualization concepts can be used to show investors and potential users that concrete has great advantages in relation to glass/steel or wood and offers additional options for construction.

Companies often have a difficult time leveraging the positive qualities of their brand into new product extensions. Our primary research has shown that engineers, project managers, and designers do not view concrete manufacturers as consultative resources. This perceptual gap between CEMEX’s primary businesses and its consultative services is problematic. For this reason, we are proposing a product that can help bridge that gap.

We propose a new, premolded, building material that can be used for the construction of small to medium height structures with a focus on sustainability and conspicuous conservation. The new building blocks will provide the same building experience as traditional premolded blocks but with an ecological focus. The intent is to further CEMEX’s focus on innovative products and services (i.e. building and sustainability consulting) as a way to create a competitive advantage that will be difficult for competitors to reproduce. We are focusing on individuals and small to medium size customers because we believe they will be more accepting of new building methods vs. those in charge of large construction projects. This will help CEMEX develop a track record of innovative success that can help persuade large customers of the value CEMEX’s innovative services can bring to their projects.

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PROBLEM STATEMENT W

hile conducting our research we identified three major categories of problems CEMEX and its industry face: microeconomics , communication , and an unpredictable future . These problem areas would become the basis for our design requirements.

MICROE-CONOMICS Microeconomics dictates that standard concrete producers are price takers and survival rests on a company’s ability to reduce operating costs beyond that of its competition. This also leaves commodity companies vulnerable to demand shifts and anti-competitive dumping practices by its competitors. It is clear that CEMEX wishes to increase the diversity of its concrete and cement products away from its competitors, however this is a temporary solution as new concretes face commoditization as well. This led us to believe that CEMEX must expand into knowledge and service based products in order to develop a sustainable competitive advantage. CEMEX is in agreement, but the path is unclear. We investigated the routes which CEMEX can take to successfully move into a new brand category.

CONSUMER PSYCHOLOGY & BRAND EXTENSIONS CEMEX is an exemplar of the concrete product category in many parts of the world. It is this status that we believe CEMEX can leverage in creating brand extensions beyond this category.

A brief review of the consumer psychology literature indicates that brand extensions are most likely to inherit the qualities associated with the parent brand if strong links exist between the parent and the extension, thus making people more accepting of the extension. CEMEX is interested in providing sustainability and other building consultancy products. However, there is a large conceptual gap between concrete manufacturing and sustainable building consulting.

We believe CEMEX can overcome this gap with a product that links the category in which CEMEX is an exemplar (concrete manufacturing) to its consultative ambitions. Therefore, we believe our solution needs to provide a conceptual link between CEMEX’s core business, and their consultancy service line. The consumer psychology literature also suggests that category-exemplar associations are bidirectional. This means that, once established, features of a strong CEMEX branded consultancy business may influence the perceptions of the CEMEX core business providing additional incentive to bridge 9 the conceptual gap with a new product.

COMMUNICATION We investigated interorganizational communication issues, but decided this was outside the scope of this project and so have provided general research references that CEMEX may find useful but have not addressed this problem specifically. Instead, we focused on the B2B and B2C communication problem.

CEMEX has developed innovative concretes that solve many design and engineering problems but have had difficulty gaining buy in from a conservative construction industry. We believe our solution must strengthen the communication channel between CEMEX and its customers. This benefits both CEMEX and its customers and provides an additional step toward establishing CEMEX as a leading consultancy business.

THE FUTURE The future is notoriously difficult to predict.

We live in a world where technological advances can disrupt long held beliefs about the status quo and change industries over night. We view concrete as a stable building material, in that it is unlikely to be replaced by a disruptive technology any time soon. However, we must be cognizant of the changing requirements of the structures concrete will be used to build in the future. We tried to imagine how population and economic trends may change the design of cities and infrastructure. A continuation of the urbanization of cities means we will likely continue to build upward rather than outward.

However, disruptive technologies such as self driving cars and telecommuting via virtual and augmented reality will likely have an impact on the way city transportation infrastructure is designed.

It may even lead to a reversal in urban population densities if jobs no longer require work to be done at the downtown office every day.

In any case, we believe CEMEX should continue its push toward knowledge based products in order to maintain its flexibility in the face of an uncertain future. We also believe that our solution should embrace the challenges posed by an increasing world population and continued urbanization. These challenges include affordable housing for a growing population both in developed and developing nations, access to fresh food, and increased pollution and greenhouse gas emissions.

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PROPOSAL

PERSONAS

The following sections address the potential customer bases, global impact, and the CEMEX specific problems listed previously.

THE MILLENIAL This is Amanda, a 28 year old entrepreneur from Austin, TX. Amanda has a busy life, full with business meetings, important phone calls, lots of friends and an occasional date.

A healthy life is very important to her. She pays attention to her daily caloric-intake and goes for a run almost every morning.

In a healthy lifestyle, food is very important. If it were possible, Amanda would like to grow her own crops and make sure that they get watered every day. Like Amanda, there are many others that feel that it is very important to live a healthy life when you are busy. The recent superfood trend is not diminishing anytime soon, and the demand for local, organic resources is growing steadily. Along with this trend, the amount of people who grow their own crops grows with it.

Cemex can contribute to this by offering a durable solution for urban gardening.

ROSA GEREMI I am a widow and I am living with my two year old son. Three years ago my husband passed away and our house was destroyed by a tsunami. It costs us two years to build up a new shelter in Kenya by our own. Now we are living of the food around our shelter and the water two miles away.�

MOMBASA – In 2002 Rosa was an enthusiastic teacher of a small school in the center of Mombasa. After the city was hit by the tsunami everything changed in her life. She have to give up her job, because she have to build up a house for her child. Because of the resignation there was nothing to eat. Her income disappeared. Her man passed away. Everything getting worse and worse. It looked like there was nothing that this two wonderful people can help. But there is a small change for these people. CEMEX wants to help the poverty and improve the economy in the world. By introducing a beautiful idea the problem should be solved. No two years construction time. No longer looking for food hundred miles away.

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DEVELOPED NATION VS DEVELOPING N A T I O N S

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e see the impact of the GreenHousing construction method addressing different needs in developed vs. developing nations.

DEVELOPED NATIONS Developed nations with large cities face urban “food deserts” where healthy food is difficult to come by, especially in poor neighborhoods. The accessibility to healthy food is a concern facing both developing and developed nations but with differing consequences.

The problem faced by developing nations is that high calorie, low nutrition food is relatively inexpensive.

When this is the only accessible food, it can lead to obesity and other health problems.

Approximately one third of the food produced in the world goes to waste2. In developing countries, 40% of the waste is due to losses at the retail and consumer levels. This means stores and individual consumers throw away food that has gone bad before it can be purchased or consumed.

Sustainability is a nebulous term that evokes emotional responses in individuals who view the planet’s resources as scarce and want to do what they can to reduce the waste they produce. As social creatures, humans search for the approval of their peers and their consumption habits, to the extent they are visible, are influenced by the disposition of others.

The intersection of social psychology and visibility of sustainable consumption has led to the idea of conspicuous conservation3. This theory suggests that people will often make purchases that cultivate others’ perceptions about their beliefs. For example, the unique and highly recognizable shape of the Toyota Prius has aided in its successful adoption by those living in environmentally conscious regions. People who want others to perceive them as environmentally responsible consumers are more likely to buy a Prius than other more conventional looking hybrid vehicles.

We believe that the our solution will help solve the food desert problem by allowing people to grow a nutritious portion of their own food. By growing food at or close to the point of consumption, we also eliminate a large portion of waste due to transportation and shelf spoilage. This has been a driving force for the vertical gardening movement in several cities around the world. We also believe that conspicuous consumption will provide additional incentive to push the boundaries of vertical gardening.

2 http://www.fao.org/save-food/resources/keyfindings/en/ 3 http://are.berkeley.edu/fields/erep/seminar/Prius_ Effect_V1.5.1.pdf

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DEVELOPING NATIONS Developing nations face food shortages as well, but these are often not offset by cheap, high calorie foods. People living in these nations may lack strong housing and basic nutrition.

They may also have limited access to water. The GreenHousing can provide solutions that address these problems and help some of the most vulnerable populations.

4 https://www.irs.gov/businesses/plug-inelectric-vehicle-credit-irc-30-and-irc-30d 5 http://www.energy.gov/lpo/publications

SUSTAINABILITY - A PUBLIC GOOD Vertical gardens require less water. This is becoming increasingly important as the effects of climate change make water scarcity a problem for many areas around the planet. These effects have been seen in places like California, Brazil, and South Africa to name a few. And the droughts are only projected to get worse as global temperatures continue to rise. Vertical gardens also provide additional insulation to buildings thereby reducing the required amount of heating and cooling. This will help reduce energy use. Finally, vertical gardens also help reduce pollution and capture carbon from the atmosphere.

For a more detailed review of the pollution reduction benefits, please see Appendix A. Governments have been subsidizing sustainable consumption in the form of tax credits or rebates (energy saving appliances, electric or hybrid vehicles, solar panel 4 installation), and direct investment5 (solar and wind farms) for a long time now. We believe the public benefits mentioned above make our solution a good candidate for government subsidies and grants.

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HOW ARE WE ADDRESSING CEMEX PROBLEM AREAS We believe the most sustainable solution to CEMEX’s “commodity trap” problem is to extend its brand into knowledge and service based products. Our solution helps bridge the conceptual gap between the core and consultancy business units.

The solution will also provide a communication link between CEMEX and its customers.

This will increase CEMEX’s ability to learn about the challenges its customers face (a key requirement for any consultancy) and will provide a learning channel to help increase the awareness of its value added products.

Sustainability was a major concern for individuals we interviewed and is likely to increase in salience when considering product purchases. Therefore, sustainability is a conspicuous feature of our solution. As noted earlier, we know CEMEX is committed to sustainable efforts, but the general public may be far less aware. If executed properly, the bidirectionality of attributes associated with our solution as a category exemplar will allow CEMEX’s core business to benefit from a perception of sustainability as well.

Finally, our solution will be adaptable to the changing requirements consumers will demand in the future. These changes will likely be due to technological disruptions in peripheral industries, rather than a direct effect on concrete itself. However, the changes may have a profound impact on the structures concrete is used to build.

Our solution takes current economic and consumer trends into consideration in order to be commercially viable.

TECHNICAL SPECIFICATIONS The following sections describe some of the technical details required for successful implementation.

DESIGN

1.POLE The poles are the base of the building (skeleton ). The poles retain the blocks together. It's not made out of concrete, because it has to be movable and strong.

Recycled plastic is one option. The pole has no standard measure, because in the whole house there are multiple sizes.

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2.BLOCK The block is made out of concrete. The block is formed in a way that it fits in each other. The process of making it would be injection moulding. With this method you can squeeze the block into a mold. The block can be made from a combination of standard concrete and specialty concrete to give it additional properties such as insulation.

3.ROOF The roof is a corrugated sheet. The reason we choose this one is because of the price, stregth, avaliability and association to the traditional ceeling shape.

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4. GREEN-BLOCK The green block is made out of concrete.

The function of this block is that you can put soil and seeds in it.

The seeds will grow and the people can live with extra oxygen and healthy food, the one that builds up more in the emotional relationship with people.

5. HALF-BLOCK This half block is made out of concrete and looks exactly the same as the normal block. This one is shorter size.

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STACK- ABILITY It is common practice to use a binder (cement mortar) when constructing a brick or cinder block wall. The interlocking design of this solution removes this step in the building process.

This results in a faster building process with less labor.

We realize that innovative manufacturing processes may be required to produce the tight tolerances required. However, we do not believe this is a prohibitive challenge.

CHOOSING THE RIGHT PLANTS It’s necessary to use specific kinds of seeds because not all the vegetables are able to grow well, vertically, on a wall. It could be useful to grow purifier herbs in addition to edible plants, to improve the wall’s air cleaning ability and reduce pollution faster.

EDIBLE PLANTS

CLIMBING

TRAILING

BRASSICA

ROOT & BULB

GREENS

HERBS

Pole beans Peas - Asparagus Beans - Cucumbers Malabar Spinach

Pumpkins Sweet Potato

Cabbage Broccol i- Califlower Kale

Tomatoes Tomatillos Pepers

Lettuce Spinach - Swiss Chard Red Amaranth

Chives - Basil Oregano - Sage Mint - Parsley Cilantro

PU RI F IE R P LA NT S

GOLDEN POTHOS ↓Formaldehyde, Xylene, Toluene, Benzene, Carbon Monoxide

ENGLISH IVY

RUBBER PLANT

CHINESE EVERGREEN

↓Benzene, Carbon Monoxide, Formaldehyde, Trichloroethylene.

↓Benzene, Carbon Monoxide, Formaldehyde, Trichloroethylene.

↓Benzene, Carbon Monoxide, Formaldehyde, Trichloroethylene.

COMMUNICATION

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he following sections address marketing and the emotional connection this product will help to foster between consumers and CEMEX.

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COMMUNICATION & RELATIONSHIP WITH THE CUSTOMER More than just a new building material, the GreenHousing block solution should be supported by CEMEX as a service in sustainable construction. Once developed, CEMEX should build a dedicated website to educate customers and governments about the benefits to building with the GreenHousing solution.

The site should include the best types of plants to grow given one’s geographic location. The site should also provide instructions to show the ease of building with these blocks. Best practices and maintenance should also be covered so that people can successfully grow their own food and reduce the pollution in their communities. In the beginning, CEMEX should also provide hands on training for new builders.

These efforts are essential in connecting with CEMEX’s customers in a way that will build trust in the brand as CEMEX develops its other consulting services.

EMOTIONAL RELATIONSHIP WITH CONCRETE This solution is directly related to emotions on many levels. We can start by going back to the ecosystem nature principle or systemic approach of things. With the Real Green housing we intend to educate people (future decision makers) in the holistic approach for living. It will generate the conscious way of existence, belonging to the environment where we develop.

Instead of just being avid consumers of what we need, we believe in the statement of learning by doing. Thus GreenHousing would exercise unconsciously the mind to grow more aware of our surroundings, environmental and personal ones.

Our research showed that sustainability and green living has a strong emotional connection with consumers. The connection that our product makes must be real and strong enough on different levels that people will feel this link for many reasons.

In addition to cleaning air and reducing pollution, our solution provides families with real, tangible, benefits by providing a portion of their nutrition. GreenHousing will also give people better quality of life with a dignified home made from top quality materials and technology.

It is important to mention the principles of branding in which brands have to appeal and remind people of the mental associations that build brand image. Accordingly GreenHousing would reposition CEMEX as a world construction leader, not only as the expert in technology, but also as the builder of a shared future. CEMEX is the doer when hard times come, this time fighting against several of the main problems the world faces these days, pollution and inequity.

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CONCLUSION

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e believe that CEMEX can build a strong consulting business that sets it apart from its competitors. This pivot into knowledge based products is essential in building and preserving a competitive advantage. Our solution attempts to bridge the perceptual gap between CEMEX’s core business as a commodity producer and the knowledge based direction they wish to pursue. GreenHousing also provides customers with an environmentally focused building solution that benefits society as well as the individual. This should provide CEMEX with an additional revenue stream, the possible conversion of other building material users to concrete, and a new perception of CEMEX as a leader in sustainable efforts and knowledge based products.

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GREEN HOUSE CEMEX FINAL REPORT BORBOLLA + CASULLO + DE VREE + GA RCIA + HOSFORD + SLOTS

POLE PROJECT / 2016