Waste Management Strategic Analysis Term Paper

  • Length: 33 pages
  • Subject: Transportation - Environmental Issues
  • Type: Term Paper
  • Paper: #56262122

Excerpt from Term Paper :

Waste Management: A Strategic Case Analysis

Company History

External Analysis

General Environmental Analysis

Demographic Segment

Economic Segment

Political/Legal Segment

Socio-Cultural Segment

Technological Segment

103.1.6 Global Segment

103.1.7 Summary of General Environmental Analysis

113.1.8 Driving Forces

123.2 Industry Analysis

123.2.1 Description of the Industry

123.2.2 Industry Dominant Economic Features

133.2.3 Market Size

133.2.4 Market Growth Rate

143.2.5 Industry Trends

153.2.6 Five Forces Analysis

173.2.7 Industry Key Success Factors

184.0 Internal Analysis

184.1 Organizational Analysis

194.1.1 Corporate Mission

194.1.2 Products and Services

194.1.3 Leadership

204.1.4 Organizational Culture

Structure

204.1.6 Strategy

214.1.7 Summary of Organizational Analysis

214.2 Analysis of Firm Resources

214.2.1 Tangible Resources

224.2.2 Intangible Resources

234.2.3 Summary of Firm's Resources

234.3 Capabilities

244.3.1 Value Chain Analysis

254.3.2 Core Competencies and Sustainable Advantages

254.3.3 Summary of Firm's Capabilities

264.4 Financial Analysis

264.4.1 Valuation Analysis

264.4.2 Growth Analysis

274.4.3 Profitability Analysis

274.4.4 Financial Strength Analysis

284.4.5 Management Efficiency Analysis

284.4.6 Summary of Financial Analysis

295.0 Strategic Issues Analysis

295.1 Critical Challenges

305.2 Resources and Capabilities

315.3 Strengths and Weaknesses Analysis

325.4 Opportunities or Threats Analysis

346.0 References

List of Figures

Figure 3-1: United States Population Growth, 1900-2010 5

Figure 3-2: U.S. Resident Population by State 6

Figure 3-3. United States GDP Growth 7

Figure 3-4: Waste Management Revenue 14

Figure 3-5: The Five Forces 15

Figure 4-1: Waste Management Value Chain 24

1.0 Executive Summary

Waste Management is one of the largest waste companies in the United States. They comprise nearly 25% of the market when it comes to comprehensive management of waste and the utilization of environmental services (Waste, 2014). The company has achieved much since its creation in 1971, but there are challenges ahead that it must address in order to continue to be successful. If it wants to remain one of the leaders in the waste management industry, the company must continually evaluate the strengths and weaknesses it has in order to prepare itself more clearly for the opportunities and the threats that will come its way.

This study will conduct a thorough analysis of Waste Management based on both its external and internal environment. That will allow the company to see what future market occurrences will be and how the strategies it currently has can and should be aligned to address those occurrences. There are several key points that will also be discussed, including key success factors for the industry, resources, driving forces, and company capabilities. Additionally, there will be a comprehensive analysis that will show how the company can handle future challenges from both internal and external environments. The goal of that analysis is to show that there are major challenges of which Waste Management must be aware. Then the company's core competencies will have to be identified so that its capabilities and resources can be examined. Putting this all together will give an indication of how prepared the company is to handle anything that comes its way.

The study also addresses the weaknesses, threats, opportunities, and strengths that will allow the company to make changes to its strategy and face challenges properly. Results show clear insight for the company's capabilities and how Waste Management can address any issues along its path.

2.0 Company History

2.1 Background

Waste Management was founded in 1971 by Dutch immigrants. It went public that same year, and by the following year it was buying up a number of smaller companies to make a conglomerate (Waste, 2014). There were 133 acquisitions made in 1972, and the company managed $82 million in revenue. There were 600,000 residential accounts that belonged to the company, along with 60,000 industrial and commercial accounts (Waste, 2014). Ontario and Quebec were part of the company's territory, along with 19 states. During the 1980s, Waste Management was able to acquire Service Corporation of America, which made it the largest waste hauler in the United States. Starting in 1992, the accounting at Waste Management became questionable, and this continued through 1997 (Waste, 2014).

There were a number of things done during that period of time that were unacceptable from an accounting standpoint, as the company worked to make itself look much better than it actually was when it came to revenue. A new CEO took over in 1997, and had the accounting practices reviewed. He found the discrepancies and in 1998 the company made the largest accounting restatement in history, adjusting its earnings by $1.7 billion dollars. In 1999 the company brought in new people to help it recover. New technologies have been implemented, along with new safety standards and practices for its day-to-day operations. In 2008, Waste Management tried to buy Republic Services, Inc., which was their main competitor, but the bid was withdrawn later that same year. The economic crisis in 2009 required Waste Management to restructure and reduce its workforce (Waste, 2014). Since that time the company has been growing again, but doing so cautiously because of the continued difficulties with the economy throughout the country and the world.

2.2 Purpose of This Study

This particular study has an important purpose. It is designed to analyze both the internal and external factors and environments that affect Waste Management in order to see the key factors to success and the driving forces behind the company. Those factors and forces will be analyzed in order to assess them against the capabilities and resources of the company. That can help the company determine whether it is truly ready to face challenges that come its way, or whether there are changes that have to be made in order to be properly prepared for issues in both the internal and external environment. The company must learn to overcome its challenges, but that cannot be easily done until it can be seen whether the Waste Management has the proper tools to do that now, or whether it must acquire more tools in order to make it more successful overall.

3.0 External Analysis

The external analysis focuses on the macro-environment faced by an organization (Armstrong, 2006). This can often influence the decisions that the organization makes. There are two things that have to be analyzed externally -- the general environment as a whole, and the industry itself. Only then can all the issues surrounding the company be properly seen and fully addressed in the best way possible.

3.1 General Environmental Analysis

An analysis of the general environment is designed to assess and scan the external trends and forces that impact not only the industry, but the organization and the market. The data from the analysis can be used to help the company prepare and stay settled in an environment that is increasingly competitive. There are several segments of the general environment that have to be considered in an analysis. These include socio-cultural, global, technological, economic, demographic, and political/legal.

3.1.1 Demographic Segment

The waste management industry reaches nearly everyone in the developed world. Because of that it is important to focus on the demand for waste management and environmental services, and how they are both affected by the population of an area. The growth of any given population is affected by many things, and in turn that growth also affects many things -- including the need for waste management services. The waste management industry is one that is very focused on the logistics of making sure waste is picked up on schedule and disposed of properly, so it is important to track trends in population in order to know where more (and fewer) services may be needed.

Having this information will help Waste Management determine where it needs to place most of its focus, in order to remain a strong contender in its chosen industry. More residential areas can mean a higher demand, but so can more industrial and commercial areas. Because there are big differences in how many waste services will be needed between commercial/industrial and residential locations, Waste Management must focus on dividing them in order to really understand where its services can be best utilized. However, before it can do that it has to track the growth of the actual population in order to have a better idea of how much growth and development is going to be seen overall.

Without having the proper knowledge based on growth and development, a company like Waste Management can end up losing out on waste services people need because it was not focused on the population growth in a way that allowed it to plan ahead and be ready for that growth. Trying to catch up to the growth after the fact can really pave the way for other companies to step in and overtake Waste Management. Figure 3-1 shows that the population of the United States has continued to increase over time, and all indications are that it will continue to do so.

Figure 3-1: United States Population Growth, 1900-2010. Source: www.immigrationeis.org

It is also important to address the population of residents of the United States by state, because that will help Waste Management determine what states it wants to operate in and what it…

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