Lorenzo Zambrano: Demise of a Pathfinder

Lorenzo Zambrano, CEO of Cemex, 1944-2014

BY BEATRICE E. RANGEL

Up and until 1994 Latin American entrepreneurs enjoyed the quiet lull of organized and predictable markets that enjoyed the protection provided by tariff walls.  But that year it became clear for those with vision that the conditions were about to change, Indeed, the impending ascent of NAFTA was about to open the door to competition.

Lorenzo Zambrano saw the handwriting on the wall and decided to jump into the convoluted waters of competitive economics with enthusiasm and wisdom. He understood that there was much more to gain in terms of value creation by enhancing the reach of Cemex in the world than staying in Mexico and milking a domestic market that would soon be populated with competitors.

Before leaping into the world pool he prepared himself and his team by enlisting a team of talented advisors that included Violy McCausland, the New York based M&A queen, and Fernando Flores, the teambuilding-cum-decision-making-enhancer wizard. Ms. McCausland helped him identify the best acquisition targets in the Iberian Region. Mr. Flores supported his vision and his leadership with the development of a business structure that combined data mining practices with performance-enhancing technologies.

This positioned Cemex as the uncontested regional leader in effectiveness and productivity. Acquisitions and installment of good practices was key in converting Cemex into a truly multinational corporation. From a non-recorded and distant position in the world market, Cemex became the leading cement company in the world from 1994 to 2004.  

And while the company took a big blow when the world financial crisis brought construction to a standstill, Mr. Zambrano quickly maneuvered to return the company to profitability. Harsh cost-cutting measures were undertaken while protecting talented resources that were essential to maintain competitiveness over the long run.

Mr. Zambrano’s enchantment with value creation led him to reject the glitz on worldly living and the jet setting circuit of galas, yachts and sports. He enjoyed working and only attended social events where he would learn more about value creation or empower other people to pull ahead and succeed.

He loved his city of birth Monterrey and lent many of his executives to public service in the understanding that they would disseminate good practices for the common good. 

And while he only held 1 percent equity position in Cemex, his value creation was such that at the time of his death that percentage was close in value to the total value of Cemex in the 1980s.  

Mr. Zambrano will be dearly missed by a new generation of managers and business leaders that formed themselves in the Monterrey Tech thanks to his efforts to extend its reach to all of Mexico and large parts of Latin America.

Beatrice Rangel is CEO of AMLA Consulting Group, a business development advisory firm in Miami. She has also served as Chief Strategist for the Cisneros Group of Companies and as Minister of the Secretariat during the Presidency of Carlos Andrés Pérez (Venezuela).She wrote this column for Latinvex.  

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