Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges
This article presents an in-depth case study detailing the history, experiences, and wider practitioner and policy lessons from a circular economy business model over a 30-year period, highlighting the successes, difficulties, and conflicts of adopting a circular economy model. The case is based on interviews, key documents, and customer insight. The findings demonstrate how sustained circular economy business practices can deliver significant new revenues, resource productivity, and business continuity benefits, but also require managers and practitioners to develop competencies and capabilities, such as balancing linear and circular systems, to address complex and highly dynamic factors, including rapid technological shifts and market volatility.
Authors :: Peter Hopkinson, Markus Zils, Philip Hawkins, Stuart Roper
Swot Analysis of "Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges" written by Peter Hopkinson, Markus Zils, Philip Hawkins, Stuart Roper includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Circular Economy facing as an external strategic factors. Some of the topics covered in Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges case study are - Strategic Management Strategies, Competitive strategy, Customers, Decision making, Economy, Research & development, Sustainability and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, technology disruption, increasing household debt because of falling income levels, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%,
banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, etc
Introduction to SWOT Analysis of Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Circular Economy, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Circular Economy 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges can be done for the following purposes –
1. Strategic planning using facts provided in Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges case study
2. Improving business portfolio management of Circular Economy
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 Circular Economy
Strengths Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Circular Economy in Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges Harvard Business Review case study are -
Strong track record of project management
– Circular Economy is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Circular Economy has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Circular Economy 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.
High switching costs
– The high switching costs that Circular Economy 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 Circular Economy 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.
Ability to lead change in Strategy & Execution field
– Circular Economy 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 Circular Economy in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Circular Economy digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Circular Economy 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.
Training and development
– Circular Economy has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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.
High brand equity
– Circular Economy has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Circular Economy to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Circular Economy in the sector have low bargaining power. Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Circular Economy to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Strategy & Execution industry
– Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges firm has clearly differentiated products in the market place. This has enabled Circular Economy to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Circular Economy to invest into research and development (R&D) and innovation.
Analytics focus
– Circular Economy 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 Peter Hopkinson, Markus Zils, Philip Hawkins, Stuart Roper 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.
Organizational Resilience of Circular Economy
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Circular Economy does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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 Circular Economy has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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 Circular Economy 's lucrative customers.
High cash cycle compare to competitors
Circular Economy 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.
Slow to strategic competitive environment developments
– As Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges HBR case study mentions - Circular Economy takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the segment, Circular Economy 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.
No frontier risks strategy
– After analyzing the HBR case study Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges, 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.
Interest costs
– Compare to the competition, Circular Economy 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.
Slow decision making process
– As mentioned earlier in the report, Circular Economy 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. Circular Economy 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges, is just above the industry average. Circular Economy 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.
Lack of clear differentiation of Circular Economy products
– To increase the profitability and margins on the products, Circular Economy needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Circular Economy 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.
Opportunities Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges | 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Circular Economy 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, Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Circular Economy can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
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 Circular Economy in the consumer business. Now Circular Economy can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Circular Economy to increase its market reach. Circular Economy will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Circular Economy 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 Circular Economy to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Circular Economy 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.
Creating value in data economy
– The success of analytics program of Circular Economy has opened avenues for new revenue streams for the organization in the industry. This can help Circular Economy to build a more holistic ecosystem as suggested in the Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges case study. Circular Economy can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Circular Economy 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.
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 Circular Economy 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.
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. Circular Economy can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Circular Economy 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Circular Economy to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Circular Economy is facing challenges because of the dominance of functional experts in the organization. Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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.
Building a culture of innovation
– managers at Circular Economy 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.
Threats Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Circular Economy with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Circular Economy 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.
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 Circular Economy business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Circular Economy 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges, Circular Economy 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 .
Technology acceleration in Forth Industrial Revolution
– Circular Economy has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Circular Economy 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.
Environmental challenges
– Circular Economy 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. Circular Economy can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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.
Shortening product life cycle
– it is one of the major threat that Circular Economy is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Circular Economy
– 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 Circular Economy.
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. Circular Economy 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
– Circular Economy 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Circular Economy 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges .
Weighted SWOT Analysis of Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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 Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges 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 Circular Economy needs to make to build a sustainable competitive advantage.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of Managing a Complex Global Circular Economy Business Model: Opportunities and Challenges
