(103-1) Grupo Argos is aware that in order to achieve better performance in the long term, operating in dynamic, changing and highly competitive markets, is not enough to continue to manage in the traditional way. It is necessary to be able to respond effectively to current challenges, identify opportunities, and anticipate future trends and risks to generate added value and mobilize the company’s differentiation in the market. Grupo Argos sees innovation as a key factor for success of the holding company and its businesses.
Grupo Argos, as a holding company of investments, seeks to allocate capital over time by protecting the environment and ensuring creation of value to the company and its stakeholders in a sustainable way in the long term. This represents a great opportunity to build a close and active relationship with all affiliates. That’s why Grupo Argos addresses innovation through three main focal points: synergies, efficiency and culture into the entire matrix including the Cement, Energy, Concessions and Urban Development businesses.
Creating synergies is important to generate competitive advantages and to create different dynamics, where pertinent spaces can host the emergence of new knowledge, develop new products, processes and services or improve existing products. By transferring knowledge and best practices among businesses and implementing new technologies, increased operational efficiencies are generated, and via a culture of innovation these practices are guaranteed to permeate the entire company.
During 2016, the Policy of Relationship between Businesses Linked to the Argos Corporate Group was approved, which provides an overall framework of action to implement and strengthen management and governance practices, always based on integrity as the general principle and, considering at all times, respect for the institutions that every company has implemented. It clearly states the general corporate strategy which lays out that business activities in the Business Group are oriented around several fundamental premises, one of which is the promotion of continuous innovation in each of the activities, companies and businesses.
Additionally, two of the action principles included in this policy are:
- Maintain a long-term vision that incorporates efficiency and innovation, without neglecting the creation of short-term value.
- Consider knowledge and innovation management as critical factors for generating value, promoting at all times the comprehensive development of employees.
See Policy on Relationships between Affiliated Companies of the Argos Corporate Group in:
Innovation in the affiliates
Grupo Argos businesses have taken innovation as an essential component of their work and this approach has the potential to impact the partnership with the development of new products and services
seeking to meet the needs and expectations of stakeholders.
The Cement business has the Argos Center for Innovation which aims to become a space for the incubation of new business, and create at least two new companies that will develop categories of high value products.
This initiative is an example of how to strengthen the commitment to innovation through the University – Company – State model and with the development of industry, region and country.
Among the most outstanding results in the cement business are:
- Commercial launch of three new advanced products: high performance concrete, micro cement and Roadbinder.
- During 2016, Line 2 of the Rioclaro plant succeeded in replacing 6% of alternative fuel heat consumption with used tires. Replacement reached historical levels of nearly 11% between September and December.
- Increased use of alternative raw materials including synthetic plaster, fly ash and slag.
- Launch of Emerging Business Opportunities.
- Five innovation challenges were implemented in several countries, involving more than 400 employees, resulting in more than 200 ideas with savings in excess of US$4 million.
In the last year, the energy business has been transformed from being a company of assets from the generation and distribution of electricity to a company that has progressively penetrated new lines of business in three segments: Homes, Companies and Cities, which points to the diversification of income that the business strategy is seeking to 2025.
Among the highlighted facts are:
- In conjunction with the Canada’s Advanced Energy Center, we worked on the identification of energy storage systems for generating plants in the different countries in which it operates.
- Invested in photovoltaic generation and marketing for industrial customers.
- Started to trade the thermal districts product.
- Built the second version of the electric bus with Colombian engineering (MIO Electrical, in Cali), which is intended to improve technical and economic performance of the first version built in 2014.
- Evaluated business models to reach other market segments with products such as: development of electric vehicles (bicycles and motorcycles), charging stations for electric vehicles in public places and in commercial fleets, automation of homes and energetic exploitation from urban solid waste.
In the long term the innovation model from Grupo Argos will be consolidated to build and promote the innovation agenda, new business models and synergies in order to manage opportunities that enable the combination of financial, human and infrastructure capital of two or more companies of the Group.
- Leading the strategic direction and priorities of the innovation strategy in all companies of the Argos Corporate Group, and how it should contribute to the implementation of corporate strategy.
- Leading and supporting the integration of innovation at the corporate level, involving all the functional areas of the Argos Corporate Group.
- Leading the coordination between different companies, areas and functions of the Business Group in terms of strategic projects and innovation.
Jorge Mario Velásquez, Grupo Argos CEO