SWOT Analysis / TOWS Matrix for Waste Connections (Canada)
Based on various researches at Oak Spring University , Waste Connections is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, increasing commodity prices, talent flight as more people leaving formal jobs,
increasing energy prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Waste Connections
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Waste Connections can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Waste Connections, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Waste Connections 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 Waste Connections can be done for the following purposes –
1. Strategic planning of Waste Connections
2. Improving business portfolio management of Waste Connections
3. Assessing feasibility of the new initiative in Canada
4. Making a Waste Management Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Waste Connections
Strengths of Waste Connections | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Waste Connections are -
Diverse revenue streams
– Waste Connections is present in almost all the verticals within the Waste Management Services industry. This has provided Waste Connections 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
– Waste Connections is one of the leading players in the Waste Management Services industry in Canada. It is in a position to attract the best talent available in Canada. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Waste Connections is one of the most innovative firm in Waste Management Services sector.
High brand equity
– Waste Connections has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Waste Connections to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Waste Connections in the Services sector have low bargaining power. Waste Connections has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Waste Connections to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Waste Connections 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 Waste Connections is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Waste Connections emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Waste Connections 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.
Successful track record of launching new products
– Waste Connections has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Waste Connections 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.
Digital Transformation in Waste Management Services industry
- digital transformation varies from industry to industry. For Waste Connections digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Waste Connections 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.
Strong track record of project management in the Waste Management Services industry
– Waste Connections is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Waste Connections has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Waste Management Services industry. Secondly the value chain collaborators of Waste Connections have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Waste Connections has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Waste Connections staying ahead in the Waste Management Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of Waste Connections | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Waste Connections are -
Workers concerns about automation
– As automation is fast increasing in the Waste Management Services industry, Waste Connections 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.
High cash cycle compare to competitors
Waste Connections has a high cash cycle compare to other players in the Waste Management Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Lack of clear differentiation of Waste Connections products
– To increase the profitability and margins on the products, Waste Connections needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, Waste Connections has high operating costs in the Waste Management Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Waste Connections lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Waste Connections is slow explore the new channels of communication. These new channels of communication can help Waste Connections to provide better information regarding Waste Management Services products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Waste Management Services industry
– because of the regulatory requirements in Canada, Waste Connections 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 Waste Management Services industry.
No frontier risks strategy
– From the 10K / annual statement of Waste Connections, it seems that company is thinking out the frontier risks that can impact Waste Management Services industry. 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.
Low market penetration in new markets
– Outside its home market of Canada, Waste Connections needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Waste Connections supply chain. Even after few cautionary changes, Waste Connections is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Waste Connections vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Waste Connections is dominated by functional specialists. It is not different from other players in the Waste Management Services industry, but Waste Connections needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Waste Connections to focus more on services in the Waste Management Services industry rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Waste Connections 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.
Waste Connections Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Waste Connections are -
Better consumer reach
– The expansion of the 5G network will help Waste Connections to increase its market reach. Waste Connections 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Waste Connections can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Waste Connections can use these opportunities to build new business models that can help the communities that Waste Connections operates in. Secondly it can use opportunities from government spending in Waste Management Services sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Waste Connections 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.
Building a culture of innovation
– managers at Waste Connections 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 Waste Management Services industry.
Use of Bitcoin and other crypto currencies for transactions in Waste Management Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Waste Connections in the Waste Management Services industry. Now Waste Connections can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Waste Management Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Waste Connections 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. Waste Connections 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.
Using analytics as competitive advantage
– Waste Connections has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Waste Management Services sector. This continuous investment in analytics has enabled Waste Connections to build a competitive advantage using analytics. The analytics driven competitive advantage can help Waste Connections to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Waste Connections has opened avenues for new revenue streams for the organization in Waste Management Services industry. This can help Waste Connections to build a more holistic ecosystem for Waste Connections products in the Waste Management Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Waste Connections can use the latest technology developments to improve its manufacturing and designing process in Waste Management Services sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
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 Waste Connections 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Waste Connections 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 Waste Connections to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Waste Connections can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Threats Waste Connections External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Waste Connections are -
High dependence on third party suppliers
– Waste Connections high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Waste Connections may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Waste Management Services sector.
Easy access to finance
– Easy access to finance in Waste Management Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Waste Connections can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Waste Connections in Waste Management Services industry. The Waste Management Services 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.
Regulatory challenges
– Waste Connections 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 Waste Management Services industry regulations.
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. Waste Connections 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. Waste Connections needs to understand the core reasons impacting the Waste Management Services industry. This will help it in building a better workplace.
Environmental challenges
– Waste Connections 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. Waste Connections can take advantage of this fund but it will also bring new competitors in the Waste Management Services industry.
Consumer confidence and its impact on Waste Connections 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 Waste Management Services industry and other sectors.
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 Waste Connections.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Waste Connections 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 Waste Connections prominent markets.
Technology acceleration in Forth Industrial Revolution
– Waste Connections has witnessed rapid integration of technology during Covid-19 in the Waste Management Services industry. As one of the leading players in the industry, Waste Connections needs to keep up with the evolution of technology in the Waste Management Services 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.
Weighted SWOT Analysis of Waste Connections Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Waste Connections 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 Waste Connections 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 Waste Connections 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 Waste Connections 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 Waste Connections needs to make to build a sustainable competitive advantage.
