Introduction
Waste Management Inc. recycles and manages the waste in the US and Canada. It offers dumping, recycling, and environmental services. This essay answers three company questions. First, it will critically evaluate the recycling industry’s essential variables and dynamics that affect the chosen company’s strategy. Second, it will assess the company’s resources, capabilities, and core competencies to compete within its boundary and maintain a competitive advantage. Finally, it will critically examine the chosen company’s Corporate and Business-Level initiatives to address recycling locally and worldwide.
Question 1
PESTEL Analysis
The PESTEL framework is essential for analyzing external macro-environmental elements that affect a business. Political, economic, societal, technical, environmental, and legal concerns are analyzed. Waste Management Inc. must comply with federal, state, and local recycling rules. The company must follow a waste collection, transportation, and disposal laws (Fatema, 2023). These restrictions affect the company’s operations, and noncompliance can result in large fines. Thus, Waste Management Inc. must consider politics. Recycling industry economics are also important. GDP, inflation, and unemployment affect the industry. Waste management firms collect and treat less waste during economic downturns as companies and families cut waste production.
Sociocultural factors also have a significant impact on the recycling industry. Recycling has become an increasingly popular concept in recent years, and many households and businesses are now more environmentally conscious. This has increased the demand for recycling services and shifted consumer behavior towards sustainable waste management practices. Technological factors are also critical in waste management (Fatema, 2023). The industry is heavily reliant on technology, and technological advancements have significantly impacted the industry. Adopting advanced technology has allowed companies to improve efficiency and reduce costs, leading to higher profitability.
Environmental factors are essential to the recycling industry, and companies must implement sustainable practices to remain competitive. Waste Management Inc. has taken various initiatives to reduce its environmental impact, such as investing in renewable energy and reducing greenhouse gas emissions (Rosengren, 2020). Lastly, legal factors are also a critical consideration for Waste Management Inc. The company must comply with various laws and regulations at the federal, state, and local levels, including environmental laws like the Clean Air Act, Clean Water Act, and Resource Conservation and Recovery Act.
Porter’s Five Forces Analysis
Porter’s Five Forces analysis is a valuable tool for analyzing the industrial competition. The five key forces in the framework are new entrants, supplier negotiating power, buyer bargaining power, replacement products or services, and competitive rivalry. We’ll analyze how these forces affect Waste Management Inc.’s recycling strategy. First, new recycling companies are unlikely. The industry is highly regulated, making entry difficult. Waste Management Inc. has a large market share, making it hard for newcomers to compete. It dominates the business with a massive network of waste management, dumping, and recycling facilities across North America. This has given the organization a competitive edge by building brand recognition and client loyalty. New players also need to overcome substantial barriers to entry in the waste management industry. Waste Management’s 260 active landfills give it a competitive advantage over smaller competitors that cannot afford the same capital expenditure (Louko, 2022). Landfill construction can cost up to $800,000 per acre. New entrants must also comply with complicated environmental standards and get permits before starting operations. Its pricing power has sustained its profits. Market dominance and wide variety of waste management services give the corporation pricing leverage. Waste Management’s pricing power has kept revenues and profits consistent during economic downturns.
Business analysis requires the PESTEL framework. Politics, economics, society, technology, environment, and law are examined. Waste Management must follow federal, state, and municipal recycling laws. The company must obey garbage collection, transportation, and disposal laws (Louko, 2022). Noncompliance can result in hefty fines and harm the company’s operations. Waste Management Inc. must consider politics. Recycling industry economics matter. GDP, inflation, and unemployment affect the industry. Companies and households produce less garbage during recessions; therefore, waste management organizations collect and process less.
Actions to Keep Competitive Advantage
To keep its competitive advantage, Waste Management Inc. can take several actions. One of the most critical factors is innovation. The company should continue to innovate and invest in new technologies to improve the recycling process and reduce costs. It can also invest in renewable energy sources and use them in its operations, reducing its carbon footprint and improving its image as a sustainable and responsible company (Rosengren, 2020). Another action that Waste Management Inc. can take is to focus on customer satisfaction. It can invest in customer service and provide high-quality services that meet the needs of its customers. This can help the company retain and attract new customers, giving it an edge over its competitors.
The company can also build strong relationships with its suppliers and partners. By working closely with suppliers and partners, Waste Management Inc. can ensure a steady supply of high-quality raw materials and reduce costs. It can also leverage its partnerships to expand its operations and enter new markets. Moreover, Waste Management Inc. can diversify its services and enter new markets. The company can expand its revenue streams and reduce its reliance on traditional waste management services by offering a broader range of services, such as waste-to-energy and landfill gas-to-energy services.
Finally, Waste Management Inc. can invest in its employees’ development and training. The company can improve its operations’ efficiency and effectiveness by providing employees with the necessary skills and knowledge. It can also increase employee retention and loyalty, improving customer service and satisfaction. To maintain its competitive advantage, Waste Management Inc. should focus on innovation, customer satisfaction, supplier and partner relationships, diversification, and employee development and training. These actions can help the company improve its operations, reduce costs, and expand its revenue streams, giving it a competitive edge in the recycling industry.
Question 2
Critical Evaluation
Waste Management, Inc. can continue to be successful within its business because it possesses a wide array of resources, capabilities, and core competencies. These qualities have enabled the firm to maintain an advantage over its competitors and keep it at the forefront of the industry. The PESTEL and Porter’s Five Forces analyses that were performed for the first question make it abundantly evident that Waste Management Inc. works in a highly regulated market that presents many challenges to new entrants and has a limited number of opportunities available to it(Evreka, 2022). On the other hand, the company has been able to grow a wide variety of resources, capabilities, and core competencies. These have enabled the company to remain competitive and preserve its advantage over other enterprises. A firm’s resources comprise both the tangible and intangible assets it possesses. Both human and financial resources are considered to be resources. In addition to its financial resources, Waste Management Inc. boasts a plethora of other resources, including its extensive network of buildings, vehicles, and other equipment. Waste Management Inc. has a significant market share, which has allowed it to establish economies of scale and lower its operational expenses, giving it an advantage over its competitors.
Examples of a company’s capabilities include the organizational structure, managerial philosophy, and corporate culture of the business. A company’s capabilities may be defined as its capacity to carry out operations or tasks. Waste Management Inc. can continuously develop new technologies and improve its operations (Evreka, 2022). It is a consequence of its exceptional management team and the culture of innovation that permeates the company. In addition, Waste Management Inc. has made considerable expenditures in research and development, which has assisted the company in maintaining its position at the forefront of innovation within the industry.
Core competencies are a term used to refer to the underlying capabilities and benefits that are unique to an organization. The ability to provide comprehensive solutions for waste management, a focus on environmental stewardship and sustainability, and a reputation as a provider of garbage management services that is recognized and reliable are the primary strengths that Waste Management Inc. holds (Rosengren, 2020). As a component of its overall business strategy, Waste Management Inc. has established and continues cultivating long-term partnerships with its customers. Because of this, the company has been able to amass a loyal customer base and maintain a greater percentage of its existing clientele.
Recommendations
If Waste Management wants to keep its lead over its rivals, it needs to zero in on a few crucial areas and focus its efforts there. The first piece of guidance that can be given to the business is that it should continue to put money into the development of cutting-edge technologies so that it may raise its output level while simultaneously lowering its level of expenditure. For instance, the company may use artificial intelligence and machine learning to enhance its routing and scheduling methods. It would result in a reduction in the quantity of fuel used and an improvement in the quality of service offered to clients.
The second step that has to be taken by the firm is to make certain that they place a significant emphasis on growing the abilities and expertise of their current personnel (Plc, n.d.). This is the second step that needs to be implemented by the organization. This can be accomplished if Waste Management always allows its employees to participate in ongoing training programs and offers them opportunities to advance in their careers. Because of this, the company will be able to maintain its competitive advantage in the market by maintaining workers who are very skilled and have a great deal of experience in their fields.
Thirdly, if Waste Management wants to grow its business, they need to prioritize offering its services in new markets (Dess, 2019). This will allow them to reach more customers. The company can accomplish this objective in one of two ways: establishing strategic alliances with other businesses currently operating in the waste management industry or successfully completing acquisitions. For instance, to expand the availability of its services to other regions, waste Management can choose to purchase more waste management companies that are significantly less important.
Finally, for Waste Management to fulfill the ever-increasing demand for environmentally responsible waste management services, the company ought to concentrate its efforts on strengthening the environmental sustainability of the processes it presently employs (Rosengren, 2020). The company can attain this objective by increasing its financial commitment to developing renewable energy sources and decreasing greenhouse gas emissions. Because it boasts many resources, capabilities, and core competencies, Waste Management Inc. can keep its position as a competitive player in the recycling market. As a result of this, the company can maintain its position.
Question 3
One of the top waste management firms in the world, Waste Management Inc., has several corporate and business-level initiatives designed to address recycling issues locally and worldwide. One of Waste Management Inc.’s main business-level strategies is focusing on sustainability and environmental responsibility. The business has committed to decreasing greenhouse gas emissions by 20% by 2025 and has invested in several renewable energy projects, including constructing landfill gas-to-energy facilities (Rosengren, 2020). Another target set by Waste Management Inc. is to remove 50% of waste from landfills by 2038; as of 2021, they had already reached a 35% diversion rate. These sustainability initiatives address the growing demand from customers and stakeholders for eco-friendly waste management solutions and are consistent with the company’s principles.
The growth of Waste Management Inc. into new markets and services is another corporate-level strategy. By purchasing Advanced Disposal Services for $4.9 billion in 2020, the business added 3 million new clients and strengthened its position in the Eastern United States (Nelson, 2019). To strengthen businesses’ waste reduction and recycling efforts, Waste Management Inc. also provides various commercial services, such as consultancy and data management. The company’s income sources are diversified, and its market share is increased due to these expansions into new markets and services.
At the corporate level, Waste Management Inc. uses several strategies to address the problems with recycling locally and internationally. One of these strategies is using technology to boost productivity and cut costs. Waste Management Inc. uses a range of technology, including its own Route Optimization System, to help streamline waste collection routes and reduce gasoline usage (Evreka, 2022). The Digital Engagement Platform from Waste Management Inc., which enables users to manage their accounts and follow data on waste and recycling online, was also introduced in 2020. These innovations not only increase business productivity but also improve client satisfaction.
Figure 1: The information above shows how the company boosts its price. It increases the prices steadily hence maintaining high profitability and competition.
Focusing on innovation and research and development is another business-level strategy Waste Management Inc uses. The business has contributed to many research initiatives, including creating biodegradable plastics and applying artificial intelligence to better garbage sorting and recycling procedures. For example, waste Management Inc. partnered with Renmatix to create a technology that turns non-recyclable paper waste into low-carbon biofuels. Waste Management Inc. has also worked with other companies to develop novel recycling technologies. Through these creative initiatives, the business can keep one step ahead of the competition and adapt to the changing needs of its stakeholders and customers (Waste Management, 2022). Hence, Waste Management Inc. has put in place a variety of corporate and business-level initiatives to address the problems with recycling on a local and international scale. Their overall strategy must include their efforts to be sustainable, expand into new markets and services, leverage technology to increase productivity and concentrate on innovation and R&D.
Summary
This article discusses Waste Management Inc.’s business environment, resources, capabilities, core competencies, and corporate and company activities to address local and global recycling issues. PESTEL and Porter’s Five Forces assess Waste Management Inc.’s recycling strategy. There is a need to have Economic, social, and cultural improvement. The essay proposes investing in new technologies, partnering with other companies, and competing abroad. The company has modern technology, trained people, and a huge waste processing network. Customers, garbage, and branding are its strengths. The research proposes improving technology and focusing on strengths to compete.
Reference List
Dess, G.G. et al. (2019) Strategic management creating competitive advantages. MCGRAW-HILL US HIGHER ED. Available at: https://www.amazon.com/Strategic-Management-Creating-Competitive-Advantages/dp/1259900452 (Accessed: April 12, 2023)
Fatema (2023) Waste management Inc. Swot & PESTLE ANALYSIS: SWOT & PESTLE, SWOT & PESTLE.com. Available at: https://www.swotandpestle.com/waste-management-inc/ (Accessed: April 12, 2023).
Louko, J. (2022) 3 things about waste management stock smart investors know, The Motley Fool. The Motley Fool. Available at: https://www.fool.com/investing/2022/10/22/3-things-about-waste-management-stock-smart-invest/#:~:text=Why%20is%20Waste%20Management%20positioned,landfills%20as%20of%20July%202022. (Accessed: April 12, 2023).
Nelson, M. (2019) Advanced Disposal, Waste Management | Business Wire. Available at: https://www.businesswire.com/news/home/20190415005336/en/Waste-Management-to-Acquire-Advanced-Disposal-for-4.9-Billion-Adding-Complementary-Assets-and-Customer-Base-in-the-Eastern-United-States (Accessed: April 12, 2023).
Plc, G.D. (n.d.) Waste Management Inc company profile – overview, GlobalData. Available at: https://www.globaldata.com/company-profile/waste-management-inc/ (Accessed: April 12, 2023).
Rosengren, C. (2020) Waste management updates sustainability plan with 2025 targets focused on climate, Waste Dive. Available at: https://www.wastedive.com/news/waste-management-sustainability-esg-2025-climate/586948/ (Accessed: April 12, 2023).
Waste management, inc. – climate change (2022). Available at: https://sustainability.wm.com/downloads/WM_CDP_Climate_Change_Response.pdf (Accessed: April 12, 2023).
Waste management software for Great Route Planning ‘ evreka (2022) Evreka ‘ Waste Management Software for Great Route Planning. Available at: https://evreka.co/blog/waste-management-software-for-great-route-planning/ (Accessed: April 12, 2023).
write