Pest Analysis Of The Mexican Peso Crisis In Mexico

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PEST Analysis
• Economic Factors
In 1982, Mexico started the precursor of the WTO and the process of entering GATT. The economic crisis forced Mexico to attract foreign investment, and the crash weakened the state-led, nationwide focused model that had developed in Mexico in the previous years.
The Mexican Peso Crisis of 1994 raised concern in the world and it came with many issues about the sustainability of the market oriented restructuring process in Latin America and other regions.
In July 1997, the Asian financial crisis raised uncertainties of a worldwide economic meltdown and had huge impact on construction because of financial infection.
The market demands are different between developed and developing counties.
In 2005, CEMEX settled its $5.8 billion acquisition of U.K.-based RMC. That a European firm would acquire RMC, which was CEMEX’s first achievement of an expanded international company.
The share price dropped quickly in 2008 in response to the worldwide downturn and credit crisis together with the significant financial influence that had supplemented the Rinker acquisition.
• Political Factors
Foreign competition was restricted by political factors.
In 1985, Mexico had already initiated the process of starting its economy after terminating its entry into NAFTA (the CEO, Lorenzo Zambrano).
Foreign direct investment policies in different countries influence the investment into business in a nation by a company of an alternative country.
• Social Factors
These managers and functional experts were selected from CEMEX operations around the world with different culture and languages. It influenced their daily duties where the newly attained company operated.
Implement key information and Intern...

... middle of paper ...

...scenario planning (Mclean, 2006). This intervention helps the company create or develop tactical plans for an individual case or a story without knowing how the work environments will be altered.
3. Open Systems Mapping: CEMEX divided 40 employees into 10 functional teams in two to three months and because of this fast organizational change, the company might need to think about how to adjust to the changes in such a short time. Also, the size of the RMC acquisition would deter management from its aim of cutting the business's debt. I believe that using open systems mapping would be quite beneficial for the company to reorganize and determine its mission and what it would like to be (Mclean, 2006). Mapping the system is like mapping where employees want the company to be in the future. This is a good approach to building these visions more specific for the company.

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