The case of CMP North America, Inc.: using innovation to compete against low cost

Abstract

This paper is a teaching case focused on the strategy of a company in a slow growth industry. Robert Jones was the VP of Sales at CMP North America, Inc., which was the North American subsidiary of a company headquartered in Pescara, Italy. The company manufactured concrete mixing machinery. In early 2014, Jones was a little surprised that corporate headquarters in Italy had set such ambitious goals: grow revenue from $2.2 million annually to $5 million within five years. Jones truly believed that CMP was the most innovative company in the North American market and manufactured the highest-quality equipment. However, the industry was fragmented, mature, highly competitive, global and dependent on the construction industry. The case is intended to help students understand the concept of differentiation as a business-level strategy.