Veolia: Internal and external strategic analysis

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Internal and external strategic analysis of Veolia:

Internal Analysis: Veolia has 318, 376 well-trained employees in 48 countries.

Strengths: Veolia has a strong record of customer-driven innovation, has an exhaustive product mix for its customers, and addresses different customer segments in Waste Management Services. It has a market leadership position, uses diverse revenue models, and has high margins. Currently, Veolia Water is the global leader in services related to water. It handles water and wastewater services and has the right technology and infrastructure. Veolia Environmental Service has waste disposal services around the world and undertakes the treatment of hazardous and non-hazardous waste. The energy service division of Veolia maintains and manages cooling systems and heating furnaces. The services of Veolia make plants more energy efficient and select the most adapted energies.

Weaknesses:

There is a decline in the per-unit revenue for Veolia. Moreover, Veolia has not been able to invest adequately in customer-oriented services. Also, the business model of Veolia can easily be replicated by competitors and this has increased the number of new entrants into the business. The dealer network of Veolia has become less important and the use of the internet and AI has significantly increased competition for Veolia. There is a strong need for increasing the operating margin and gross margin of Veolia. Because of its industry, Veolia is involved in conflicts or litigations with governments. For example, Veolia sued Lithuania in the Stockholm arbitration court demanding 100 million euros in damages (2). Moreover, the relations of Veolia with Israel are considered as supporting the oppression of Palestine and its people. Also, Veolia has got a bad name for giving unpaid internships in Ireland under the JobBridge scheme.

External strategic factors

Opportunities:

As the US economy is expanding faster than that of any other developed economy, it provides Veolia an opportunity to expand into the US market. Further, the cost of new product launches is declining because of third-party retailers and social networking. Moreover, local collaboration especially in the US market provides excellent opportunities for growth for Veolia in the international markets. Local expertise provides excellent opportunities for Veolia. Since more and more customers are moving to higher-end products, there is a great opportunity for Veolia as it has strong brand recognition in the premium segment. Also, Veolia has important opportunities because of the adoption of online services by customers. As, environmental awareness increases, there is greater demand for Veolia's services even in the lower segments.

Threats:

Veolia faces threats from the changing political environment. Moreover, there is a real threat from the Ukraine conflict, and the possibility of NATO directly entering the conflict with Russia poses a serious threat. The worsening trade relations because of the Ukraine conflict are a threat to the growth of Veolia. There is also a shortage of skilled personnel who can support the expansion plans of Veolia. The increasing technological expertise of local companies means that they can compete directly with Veolia without paying for intellectual property rights. There are many countries where intellectual property rights enforcement is very low. Further, there is an increase in competition especially in the waste management services sector.

PESTEL Analysis:

Political Factors:

Several political factors influence Veolia. These include changing policies with the new government. Moreover, the key political developments from the Ukraine conflict can adversely affect Veolia. An escalation in conflict can reduce demand for Veolia services, and can also disrupt the supply chain of Veolia. The mobilization of troops by NATO to participate in the Ukraine-Russian conflict does not auger well for Veolia. Also, the governments of different countries are under pressure to adhere to WTO's regulations on waste management. Veolia can gain because of political stability in the current markets, the role of non-government pressure groups in policy making, and the nature of the governance system that will influence Veolia.

Economic Factors

One of the important factors that will influence the growth of Veolia is the current economy of the United States. This includes the GDP growth rate, the rate of interest, and the level of unemployment. The US disposable income, the exchange rate of the US Dollar, and consumer confidence will impact the environment of Veolia. The economic factors include government intervention in the UK, the skill level of human resources in the UK, and the efficiency of financial markets. ...