Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED)

Environmentally preferable or "green" building uses optimal and innovative design to provide economic, health, environmental, and social benefits. In 1993 the U.S. Green Building Council (USGBC) was formed by a broad range of building industry stakeholders from the public, private, and nonprofit sectors. It is a committee-based, member-driven, and consensus-focused nonprofit coalition leading a national effort to promote high-performance buildings that are environmentally responsible, profitable, and healthy places to live and work. In 2000, USGBC created the Leadership in Energy and Environmental Design (LEED) rating system. That voluntary standard was intended to transform the building market by providing guidelines, certification, and education for green building. LEED is a comprehensive, transparent, and market-driven framework for assessing buildings' environmental performance. Compared to standard practice, "green" buildings can provide greater economic and social benefits over the life of the structures, reduce or eliminate adverse human health effects, and even contribute to improved air and water quality. Opportunities for reducing both costs and environmental impact include low-disturbance land use techniques, improved lighting design, high performance water fixtures, careful materials selection, energy efficient appliances and heating and cooling systems, and on-site water treatment and recycling. Less familiar innovations include natural ventilation and cooling without fans and air conditioners, vegetative roofing systems that provide wildlife habitat and reduce storm water runoff, and constructed wetlands that help preserve water quality while reducing water treatment costs.

Authors :: Andrea Larson, Chris Lotspeich, Stephen Keach

Topics :: Technology & Operations

Tags :: , SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED)" written by Andrea Larson, Chris Lotspeich, Stephen Keach includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Water Leed facing as an external strategic factors. Some of the topics covered in Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) case study are - Strategic Management Strategies, and Technology & Operations.

Some of the macro environment factors that can be used to understand the Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) casestudy better are - – there is backlash against globalization, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, wage bills are increasing, etc

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Introduction to SWOT Analysis of Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED)

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Water Leed, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Water Leed 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) can be done for the following purposes –
1. Strategic planning using facts provided in Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) case study
2. Improving business portfolio management of Water Leed
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Water Leed

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Strengths Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Water Leed in Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) Harvard Business Review case study are -

Sustainable margins compare to other players in Technology & Operations industry

– Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) firm has clearly differentiated products in the market place. This has enabled Water Leed to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Water Leed to invest into research and development (R&D) and innovation.

Diverse revenue streams

– Water Leed is present in almost all the verticals within the industry. This has provided firm in Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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.

Superior customer experience

– The customer experience strategy of Water Leed in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Ability to lead change in Technology & Operations field

– Water Leed is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Water Leed in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Successful track record of launching new products

– Water Leed has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Water Leed 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.

Learning organization

- Water Leed is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Water Leed is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Innovation driven organization

– Water Leed is one of the most innovative firm in sector. Manager in Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

High switching costs

– The high switching costs that Water Leed has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.

Cross disciplinary teams

– Horizontal connected teams at the Water Leed 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.

High brand equity

– Water Leed has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Water Leed to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Digital Transformation in Technology & Operations segment

- digital transformation varies from industry to industry. For Water Leed digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Water Leed has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.

Organizational Resilience of Water Leed

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Water Leed does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

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Weaknesses Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) are -

High operating costs

– Compare to the competitors, firm in the HBR case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Water Leed 's lucrative customers.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Water Leed has relatively successful track record of launching new products.

Capital Spending Reduction

– Even during the low interest decade, Water Leed has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED), is just above the industry average. Water Leed 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.

Slow decision making process

– As mentioned earlier in the report, Water Leed 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. Water Leed 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.

Interest costs

– Compare to the competition, Water Leed 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.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED), in the dynamic environment Water Leed has struggled to respond to the nimble upstart competition. Water Leed has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

High bargaining power of channel partners

– Because of the regulatory requirements, Andrea Larson, Chris Lotspeich, Stephen Keach suggests that, Water Leed 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.

Low market penetration in new markets

– Outside its home market of Water Leed, firm in the HBR case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Aligning sales with marketing

– It come across in the case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) can leverage the sales team experience to cultivate customer relationships as Water Leed is planning to shift buying processes online.

Lack of clear differentiation of Water Leed products

– To increase the profitability and margins on the products, Water Leed needs to provide more differentiated products than what it is currently offering in the marketplace.

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Opportunities Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) | 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 Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) are -

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Water Leed to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Water Leed to hire the very best people irrespective of their geographical location.

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 Water Leed 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.

Using analytics as competitive advantage

– Water Leed has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Water Leed to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Developing new processes and practices

– Water Leed can develop new processes and procedures in Technology & Operations 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.

Building a culture of innovation

– managers at Water Leed 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 Technology & Operations segment.

Buying journey improvements

– Water Leed can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Water Leed has opened avenues for new revenue streams for the organization in the industry. This can help Water Leed to build a more holistic ecosystem as suggested in the Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) case study. Water Leed can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Water Leed is facing challenges because of the dominance of functional experts in the organization. Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Water Leed can use these opportunities to build new business models that can help the communities that Water Leed operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Water Leed in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.

Loyalty marketing

– Water Leed 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.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Water Leed can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Water Leed 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, Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

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Threats Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) are -

Technology acceleration in Forth Industrial Revolution

– Water Leed has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Water Leed needs to keep up with the evolution of technology in the Technology & Operations 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.

High dependence on third party suppliers

– Water Leed 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.

Capital market disruption

– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Water Leed.

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.

Increasing wage structure of Water Leed

– 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 Water Leed.

Consumer confidence and its impact on Water Leed 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.

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 Water Leed business can come under increasing regulations regarding data privacy, data security, etc.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED), Water Leed may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .

Environmental challenges

– Water Leed 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. Water Leed can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Water Leed with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

Easy access to finance

– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Water Leed can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Stagnating economy with rate increase

– Water Leed 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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Water Leed in the Technology & Operations industry. The Technology & Operations 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.

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Weighted SWOT Analysis of Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Rating Environmental Performance in the Building Industry: Leadership in Energy and Environmental Design (LEED) 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 Water Leed needs to make to build a sustainable competitive advantage.

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