Swot Analysis of "TerraCycle (C): Eco-Capitalism and "Upcycling" Waste" written by Stuart Read, Lepoutre Jan, Philippe Margery includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Upcycling Terracycle facing as an external strategic factors. Some of the topics covered in TerraCycle (C): Eco-Capitalism and "Upcycling" Waste 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 (C): Eco-Capitalism and "Upcycling" Waste casestudy better are - – increasing transportation and logistics costs, increasing energy prices, supply chains are disrupted by pandemic , geopolitical disruptions, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China,
increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of TerraCycle (C): Eco-Capitalism and "Upcycling" Waste
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in TerraCycle (C): Eco-Capitalism and "Upcycling" Waste case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Upcycling Terracycle, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Upcycling Terracycle 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 (C): Eco-Capitalism and "Upcycling" Waste can be done for the following purposes –
1. Strategic planning using facts provided in TerraCycle (C): Eco-Capitalism and "Upcycling" Waste case study
2. Improving business portfolio management of Upcycling Terracycle
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 Upcycling Terracycle
Strengths TerraCycle (C): Eco-Capitalism and "Upcycling" Waste | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Upcycling Terracycle in TerraCycle (C): Eco-Capitalism and "Upcycling" Waste Harvard Business Review case study are -
Organizational Resilience of Upcycling Terracycle
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Upcycling Terracycle does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Upcycling Terracycle 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.
Diverse revenue streams
– Upcycling Terracycle is present in almost all the verticals within the industry. This has provided firm in TerraCycle (C): Eco-Capitalism and "Upcycling" Waste 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.
Ability to recruit top talent
– Upcycling Terracycle is one of the leading recruiters in the industry. Managers in the TerraCycle (C): Eco-Capitalism and "Upcycling" Waste are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Strategy & Execution industry
– TerraCycle (C): Eco-Capitalism and "Upcycling" Waste firm has clearly differentiated products in the market place. This has enabled Upcycling Terracycle to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Upcycling Terracycle to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Upcycling Terracycle has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Upcycling Terracycle 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.
Effective Research and Development (R&D)
– Upcycling Terracycle has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study TerraCycle (C): Eco-Capitalism and "Upcycling" Waste - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Upcycling Terracycle is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Upcycling Terracycle in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the TerraCycle (C): Eco-Capitalism and "Upcycling" Waste 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.
Analytics focus
– Upcycling Terracycle 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.
Innovation driven organization
– Upcycling Terracycle is one of the most innovative firm in sector. Manager in TerraCycle (C): Eco-Capitalism and "Upcycling" Waste Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses TerraCycle (C): Eco-Capitalism and "Upcycling" Waste | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TerraCycle (C): Eco-Capitalism and "Upcycling" Waste are -
High bargaining power of channel partners
– Because of the regulatory requirements, Stuart Read, Lepoutre Jan, Philippe Margery suggests that, Upcycling Terracycle 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.
No frontier risks strategy
– After analyzing the HBR case study TerraCycle (C): Eco-Capitalism and "Upcycling" Waste, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Workers concerns about automation
– As automation is fast increasing in the segment, Upcycling Terracycle needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study TerraCycle (C): Eco-Capitalism and "Upcycling" Waste, in the dynamic environment Upcycling Terracycle has struggled to respond to the nimble upstart competition. Upcycling Terracycle has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Upcycling Terracycle, firm in the HBR case study TerraCycle (C): Eco-Capitalism and "Upcycling" Waste needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Upcycling Terracycle has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Upcycling Terracycle even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Products dominated business model
– Even though Upcycling Terracycle 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 (C): Eco-Capitalism and "Upcycling" Waste should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Upcycling Terracycle is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Upcycling Terracycle needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Upcycling Terracycle to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Upcycling Terracycle has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study TerraCycle (C): Eco-Capitalism and "Upcycling" Waste, it seems that the employees of Upcycling Terracycle don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the TerraCycle (C): Eco-Capitalism and "Upcycling" Waste HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Upcycling Terracycle has relatively successful track record of launching new products.
Opportunities TerraCycle (C): Eco-Capitalism and "Upcycling" Waste | 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 (C): Eco-Capitalism and "Upcycling" Waste are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Upcycling Terracycle is facing challenges because of the dominance of functional experts in the organization. TerraCycle (C): Eco-Capitalism and "Upcycling" Waste 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.
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. Upcycling Terracycle can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Upcycling Terracycle 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Upcycling Terracycle in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Upcycling Terracycle has opened avenues for new revenue streams for the organization in the industry. This can help Upcycling Terracycle to build a more holistic ecosystem as suggested in the TerraCycle (C): Eco-Capitalism and "Upcycling" Waste case study. Upcycling Terracycle can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Upcycling Terracycle can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. TerraCycle (C): Eco-Capitalism and "Upcycling" Waste 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.
Loyalty marketing
– Upcycling Terracycle 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.
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. Upcycling Terracycle 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. Upcycling Terracycle 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.
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 Upcycling Terracycle 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Upcycling Terracycle can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Upcycling Terracycle can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Upcycling Terracycle 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.
Learning at scale
– Online learning technologies has now opened space for Upcycling Terracycle to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats TerraCycle (C): Eco-Capitalism and "Upcycling" Waste External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study TerraCycle (C): Eco-Capitalism and "Upcycling" Waste are -
Shortening product life cycle
– it is one of the major threat that Upcycling Terracycle is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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 Upcycling Terracycle business can come under increasing regulations regarding data privacy, data security, etc.
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. Upcycling Terracycle can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Upcycling Terracycle demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Environmental challenges
– Upcycling Terracycle 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. Upcycling Terracycle can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Technology acceleration in Forth Industrial Revolution
– Upcycling Terracycle has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Upcycling Terracycle 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Upcycling Terracycle can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study TerraCycle (C): Eco-Capitalism and "Upcycling" Waste .
Increasing wage structure of Upcycling Terracycle
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Upcycling Terracycle.
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 (C): Eco-Capitalism and "Upcycling" Waste, Upcycling Terracycle 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 .
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Upcycling Terracycle will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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. Upcycling Terracycle needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Weighted SWOT Analysis of TerraCycle (C): Eco-Capitalism and "Upcycling" Waste 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 (C): Eco-Capitalism and "Upcycling" Waste 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 (C): Eco-Capitalism and "Upcycling" Waste 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 (C): Eco-Capitalism and "Upcycling" Waste 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 (C): Eco-Capitalism and "Upcycling" Waste 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 Upcycling Terracycle needs to make to build a sustainable competitive advantage.
