Environmental Power Corp.: Changing Manure into Gold? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Environmental Power Corp.: Changing Manure into Gold?
This case is available in only hard copy format (HBP does not have digital distribution rights to the content). As a result, a digital Educator Copy of the case is not available through this web site.In 2002, Environmental Power Corp. (EPC), a small company developing renewable energy projects, was attempting to commercialize its "digester," a facility that extracted methane from manure, reduced manure's environmental impact, and generated electricity. The company addressed two promising convergent markets: the farm waste management market and the renewable energy market. One of the main challenges was to put together a financial scheme that satisfied the conflicting interests of four groups of stakeholders: the farmers who lacked cash, the investors who distrusted the electricity trading business after the Enron scandal, the utilities who resisted long-term commitments to buy electricity, and the government who was reconsidering its agricultural and energy policies. The primary challenge is to provide a process that reduces animal waste pollution and at the same time provides a positive renewable energy source.
Swot Analysis of "Environmental Power Corp.: Changing Manure into Gold?" written by Ray A. Goldberg, Laure Mougeot Stroock includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Manure Renewable facing as an external strategic factors. Some of the topics covered in Environmental Power Corp.: Changing Manure into Gold? case study are - Strategic Management Strategies, Policy, Sustainability and Global Business.
Some of the macro environment factors that can be used to understand the Environmental Power Corp.: Changing Manure into Gold? casestudy better are - – technology disruption, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, increasing commodity prices, there is backlash against globalization, challanges to central banks by blockchain based private currencies,
increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Environmental Power Corp.: Changing Manure into Gold?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Environmental Power Corp.: Changing Manure into Gold? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Manure Renewable, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Manure Renewable 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 Environmental Power Corp.: Changing Manure into Gold? can be done for the following purposes –
1. Strategic planning using facts provided in Environmental Power Corp.: Changing Manure into Gold? case study
2. Improving business portfolio management of Manure Renewable
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Manure Renewable
Strengths Environmental Power Corp.: Changing Manure into Gold? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Manure Renewable in Environmental Power Corp.: Changing Manure into Gold? Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Environmental Power Corp.: Changing Manure into Gold? 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
– Manure Renewable 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 Ray A. Goldberg, Laure Mougeot Stroock 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.
High switching costs
– The high switching costs that Manure Renewable 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Manure Renewable digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Manure Renewable 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.
Learning organization
- Manure Renewable 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 Manure Renewable is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Environmental Power Corp.: Changing Manure into Gold? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Manure Renewable in the sector have low bargaining power. Environmental Power Corp.: Changing Manure into Gold? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Manure Renewable to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Global Business field
– Manure Renewable 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 Manure Renewable in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Manure Renewable has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Manure Renewable to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Manure Renewable is one of the leading recruiters in the industry. Managers in the Environmental Power Corp.: Changing Manure into Gold? 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
– Manure Renewable 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 Manure Renewable in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Manure Renewable has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Environmental Power Corp.: Changing Manure into Gold? 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.
Weaknesses Environmental Power Corp.: Changing Manure into Gold? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Environmental Power Corp.: Changing Manure into Gold? are -
Low market penetration in new markets
– Outside its home market of Manure Renewable, firm in the HBR case study Environmental Power Corp.: Changing Manure into Gold? needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Environmental Power Corp.: Changing Manure into Gold? 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 Manure Renewable 's lucrative customers.
Aligning sales with marketing
– It come across in the case study Environmental Power Corp.: Changing Manure into Gold? 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 Environmental Power Corp.: Changing Manure into Gold? can leverage the sales team experience to cultivate customer relationships as Manure Renewable is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Environmental Power Corp.: Changing Manure into Gold?, it seems that the employees of Manure Renewable 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.
Increasing silos among functional specialists
– The organizational structure of Manure Renewable is dominated by functional specialists. It is not different from other players in the Global Business segment. Manure Renewable needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Manure Renewable to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Environmental Power Corp.: Changing Manure into Gold?, is just above the industry average. Manure Renewable 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.
High cash cycle compare to competitors
Manure Renewable 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Environmental Power Corp.: Changing Manure into Gold?, in the dynamic environment Manure Renewable has struggled to respond to the nimble upstart competition. Manure Renewable 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, Ray A. Goldberg, Laure Mougeot Stroock suggests that, Manure Renewable 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.
Capital Spending Reduction
– Even during the low interest decade, Manure Renewable 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Manure Renewable 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.
Opportunities Environmental Power Corp.: Changing Manure into Gold? | 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 Environmental Power Corp.: Changing Manure into Gold? are -
Building a culture of innovation
– managers at Manure Renewable 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 Global Business segment.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Manure Renewable can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Manure Renewable 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. Manure Renewable 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.
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. Manure Renewable can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Manure Renewable can use these opportunities to build new business models that can help the communities that Manure Renewable operates in. Secondly it can use opportunities from government spending in Global Business sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Manure Renewable 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, Environmental Power Corp.: Changing Manure into Gold?, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Manure Renewable to increase its market reach. Manure Renewable 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 Manure Renewable 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 Manure Renewable 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 Manure Renewable 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
– Manure Renewable 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 Environmental Power Corp.: Changing Manure into Gold? - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Manure Renewable 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, Manure Renewable is facing challenges because of the dominance of functional experts in the organization. Environmental Power Corp.: Changing Manure into Gold? 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.
Developing new processes and practices
– Manure Renewable can develop new processes and procedures in Global Business 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.
Buying journey improvements
– Manure Renewable can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Environmental Power Corp.: Changing Manure into Gold? 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.
Threats Environmental Power Corp.: Changing Manure into Gold? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Environmental Power Corp.: Changing Manure into Gold? are -
Regulatory challenges
– Manure Renewable 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 Global Business industry regulations.
Environmental challenges
– Manure Renewable 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. Manure Renewable can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Manure Renewable 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 Environmental Power Corp.: Changing Manure into Gold? .
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 Manure Renewable business can come under increasing regulations regarding data privacy, data security, etc.
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. Manure Renewable 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.
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 Manure Renewable.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Environmental Power Corp.: Changing Manure into Gold?, Manure Renewable may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
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 Manure Renewable in the Global Business 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. Manure Renewable needs to understand the core reasons impacting the Global Business 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.
Shortening product life cycle
– it is one of the major threat that Manure Renewable is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Manure Renewable 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 Manure Renewable 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.
Weighted SWOT Analysis of Environmental Power Corp.: Changing Manure into Gold? 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 Environmental Power Corp.: Changing Manure into Gold? 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 Environmental Power Corp.: Changing Manure into Gold? 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 Environmental Power Corp.: Changing Manure into Gold? 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 Environmental Power Corp.: Changing Manure into Gold? 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 Manure Renewable needs to make to build a sustainable competitive advantage.
