Swot Analysis of "TerraCycle (B): A Million Tradeoffs" written by Stuart Read, Lepoutre Jan, Philippe Margery includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Terracycle Tradeoffs facing as an external strategic factors. Some of the topics covered in TerraCycle (B): A Million Tradeoffs case study are - Strategic Management Strategies, Entrepreneurship, Innovation, Sustainability and Strategy & Execution.
Some of the macro environment factors that can be used to understand the TerraCycle (B): A Million Tradeoffs casestudy better are - – geopolitical disruptions, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, increasing commodity prices, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google,
banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, etc
Introduction to SWOT Analysis of TerraCycle (B): A Million Tradeoffs
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in TerraCycle (B): A Million Tradeoffs case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Terracycle Tradeoffs, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Terracycle Tradeoffs operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of TerraCycle (B): A Million Tradeoffs can be done for the following purposes –
1. Strategic planning using facts provided in TerraCycle (B): A Million Tradeoffs case study
2. Improving business portfolio management of Terracycle Tradeoffs
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Terracycle Tradeoffs
Strengths TerraCycle (B): A Million Tradeoffs | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Terracycle Tradeoffs in TerraCycle (B): A Million Tradeoffs Harvard Business Review case study are -
Ability to recruit top talent
– Terracycle Tradeoffs is one of the leading recruiters in the industry. Managers in the TerraCycle (B): A Million Tradeoffs are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Terracycle Tradeoffs is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Terracycle Tradeoffs is one of the most innovative firm in sector. Manager in TerraCycle (B): A Million Tradeoffs Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Terracycle Tradeoffs is present in almost all the verticals within the industry. This has provided firm in TerraCycle (B): A Million Tradeoffs case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Operational resilience
– The operational resilience strategy in the TerraCycle (B): A Million Tradeoffs Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Highly skilled collaborators
– Terracycle Tradeoffs has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in TerraCycle (B): A Million Tradeoffs HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Terracycle Tradeoffs has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Terracycle Tradeoffs has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Analytics focus
– Terracycle Tradeoffs is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Stuart Read, Lepoutre Jan, Philippe Margery can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Cross disciplinary teams
– Horizontal connected teams at the Terracycle Tradeoffs are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Sustainable margins compare to other players in Strategy & Execution industry
– TerraCycle (B): A Million Tradeoffs firm has clearly differentiated products in the market place. This has enabled Terracycle Tradeoffs to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Terracycle Tradeoffs to invest into research and development (R&D) and innovation.
Training and development
– Terracycle Tradeoffs has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in TerraCycle (B): A Million Tradeoffs Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Low bargaining power of suppliers
– Suppliers of Terracycle Tradeoffs in the sector have low bargaining power. TerraCycle (B): A Million Tradeoffs has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Terracycle Tradeoffs to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses TerraCycle (B): A Million Tradeoffs | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TerraCycle (B): A Million Tradeoffs are -
High bargaining power of channel partners
– Because of the regulatory requirements, Stuart Read, Lepoutre Jan, Philippe Margery suggests that, Terracycle Tradeoffs is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study TerraCycle (B): A Million Tradeoffs, in the dynamic environment Terracycle Tradeoffs has struggled to respond to the nimble upstart competition. Terracycle Tradeoffs has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Terracycle Tradeoffs has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - TerraCycle (B): A Million Tradeoffs should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Terracycle Tradeoffs has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Terracycle Tradeoffs supply chain. Even after few cautionary changes mentioned in the HBR case study - TerraCycle (B): A Million Tradeoffs, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Terracycle Tradeoffs vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study TerraCycle (B): A Million Tradeoffs, is just above the industry average. Terracycle Tradeoffs needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Aligning sales with marketing
– It come across in the case study TerraCycle (B): A Million Tradeoffs that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case TerraCycle (B): A Million Tradeoffs can leverage the sales team experience to cultivate customer relationships as Terracycle Tradeoffs is planning to shift buying processes online.
High cash cycle compare to competitors
Terracycle Tradeoffs has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Lack of clear differentiation of Terracycle Tradeoffs products
– To increase the profitability and margins on the products, Terracycle Tradeoffs needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study TerraCycle (B): A Million Tradeoffs has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Terracycle Tradeoffs 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Terracycle Tradeoffs has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Opportunities TerraCycle (B): A Million Tradeoffs | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study TerraCycle (B): A Million Tradeoffs are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Terracycle Tradeoffs is facing challenges because of the dominance of functional experts in the organization. TerraCycle (B): A Million Tradeoffs case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Terracycle Tradeoffs can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Terracycle Tradeoffs can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Buying journey improvements
– Terracycle Tradeoffs can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. TerraCycle (B): A Million Tradeoffs suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Creating value in data economy
– The success of analytics program of Terracycle Tradeoffs has opened avenues for new revenue streams for the organization in the industry. This can help Terracycle Tradeoffs to build a more holistic ecosystem as suggested in the TerraCycle (B): A Million Tradeoffs case study. Terracycle Tradeoffs can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Terracycle Tradeoffs can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Developing new processes and practices
– Terracycle Tradeoffs can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Terracycle Tradeoffs to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Terracycle Tradeoffs can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, TerraCycle (B): A Million Tradeoffs, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Terracycle Tradeoffs in the consumer business. Now Terracycle Tradeoffs can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Terracycle Tradeoffs can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Loyalty marketing
– Terracycle Tradeoffs has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Terracycle Tradeoffs can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Terracycle Tradeoffs can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats TerraCycle (B): A Million Tradeoffs External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study TerraCycle (B): A Million Tradeoffs are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Terracycle Tradeoffs in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High dependence on third party suppliers
– Terracycle Tradeoffs high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study TerraCycle (B): A Million Tradeoffs, Terracycle Tradeoffs may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Stagnating economy with rate increase
– Terracycle Tradeoffs can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Technology acceleration in Forth Industrial Revolution
– Terracycle Tradeoffs has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Terracycle Tradeoffs needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Terracycle Tradeoffs can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Terracycle Tradeoffs needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Terracycle Tradeoffs business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Terracycle Tradeoffs in the Strategy & Execution sector and impact the bottomline of the organization.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Terracycle Tradeoffs needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Environmental challenges
– Terracycle Tradeoffs needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Terracycle Tradeoffs can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Weighted SWOT Analysis of TerraCycle (B): A Million Tradeoffs Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study TerraCycle (B): A Million Tradeoffs needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study TerraCycle (B): A Million Tradeoffs is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study TerraCycle (B): A Million Tradeoffs is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of TerraCycle (B): A Million Tradeoffs is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Terracycle Tradeoffs needs to make to build a sustainable competitive advantage.
