Terracycle Innovation: A Report on Innovational Models and Strategies

This report provides a comprehensive analysis of Terracycle, a US-based recycling company, focusing on its innovative business model and operational strategies. The report begins with an introduction to innovation and its importance for businesses, followed by a detailed discussion of the Pentathlon framework, a model for effective innovation management, covering innovation strategy, idea generation, prioritization, implementation, and human resource management. The analysis then applies this framework to Terracycle, examining its historical development, current operations, and future innovation pathways. The report highlights Terracycle's approach to collecting and recycling non-recyclable waste, its partnerships with various stakeholders, and its role in creating new products from recycled materials. The conclusion summarizes the key findings and emphasizes the significance of innovation for Terracycle's growth and sustainability in the marketplace.

Managing Innovation

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
PART 1............................................................................................................................................3
Discussion of innovational model....................................................................................................3
PART 2............................................................................................................................................7
Application to Terracycle................................................................................................................7
Introduction to TerraCycle:-...................................................................................................7
Historical discussion of innovation:- .....................................................................................7
Future innovation pathway:- ..................................................................................................8
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Innovation refers to the process of converting an idea into a product or service that create
value and for which customer is willing to pay (Archibald and Archibald, 2016). This process
cover up multiple activities that contribute toward uncovering the way of doing new things.
Innovation is critical for an organisation as it help in maximising the return over investment,
increase profitability and able to effectively respond to external challenges. On the other hand,
diffusion in innovation refer to the hypothesis outlining regarding the way in which new
innovation will spread throughout culture and societies from introduction to wider adoption.
This report is based on TerraCycle which is a private business of recycling, headquartered in
New Jersey, US. Terracycle run a program where non-recyclable pre and post consumer waste
has been collected with corporate donors and then converted into raw material for new product
development.
The main purpose of conducting this report is to provide a deep knowledge about the
innovation that can bring by TerraCycle for its operational enhancement and future growth
within the marketplace (Aalbers and Dolfsma, 2015). This report perform a detailed analysis
over innovational theory for determining various factors that may help company in bringing
innovation within the business. Further it include the application of theory for evaluating the
historical development done by company for identifying the future development pathway of
product or services.
MAIN BODY
PART 1
Discussion of innovational model
Innovation is defined as a the process of bringing a new method of doing thing that help
in improving the result of particular action. It help a business in enhancing their way of doing
thing in order to improve their performance at marketplace (Allen, Adomdza and Meyer, 2015).
Innovation plays an essential role within the growth and success of any business as by innovating
their product, service or process it will be able to retain its customer for longer period of time.
Now a days technology is become most essential part of every business as it help in
simplifying their operations and making them able to fulfil the demand of its target market
effectively. This is the reason why business environment is becoming more competitive and

dynamic where chances are experienced at a rapid pace, which also contributing toward
increasing the expectation of customer regarding services offered by a company (Altuna and et.
al., 2015). Hence each business must keep on innovative its product or processes in order to
remain competent toward changes in external environment as well as customer expectation. So,
in order to bring and implement innovation within the business effectively a company must use
innovation theory or models. This will help in providing a framework which guides up a path to
take action towards the formation and implementation of innovation (Goffin and Mitchell, 2016).
One of the best known model for innovation is Pentathlon framework which work over five
essential factors that must be considering while bringing any innovation within business. It
includes idea management & creativity management, prioritization, selection and portfolio
management, Implementation management, innovation strategy, human resource management.
(Source: PENTATHLON-FRAMEWORK, 2019)
From the above given image it has been clear that Pentathlon framework is a theory
which revolve around five key element that are very essential for an innovational success. This
model is divided into three factors in which at top most section talks about the innovational
strategy which depict what is required to do for achieving goals (Salerno and et. al., 2015). The
middle section is consists a process that includes germination of ideas and its prioritisation as per
the demand, so that it can be implemented for new product development and its interaction
within marketplace. The last section focuses toward featuring the human factor within innovation
in order to implement the innovational plan effectively. These three section consists of five core
elements of innovation that are essentials within innovational process. These five elements seek
Illustration 1: PENTATHLON-FRAMEWORK

to address the issues on which majority of research related to innovation that focuses product
instead of any service (Bucciarelli, 2015). In addition to this, framework also focuses on
innovation management by focusing over these five elements. These element of innovation
management are explained below:-
Innovation strategy:- This step focuses toward analysing the various type of concern
area for an organisation which includes role of technology, market trend, role of communication
within the innovation and matching resource (Hernandez-Munoz and et. al., 2015). After
evaluating all these factor, company will be able to determining the area in which innovation can
bring so that company will be able to accomplish their goals and objectives. Once a deep
analysis has been performed over these factors information collected will help in formulating
innovational strategy which brings improvement in current performance. This strategy will
provide a pathway over which company has to work in order to achieve competitive advantage.
For instance, Apple Inc. is best known for its innovation as it focuses toward analysing the
market demand in order to invent or bring new device to market. This is the main reason behind
its success at marketplace.
Ideas generation:- This step of innovational framework focuses over generation of a
new idea in order to deal with the problem or challenges faced by company. This idea is usually
framed after analysing the challenges company is facing in external environment, customer
expectation and technological development. Idea generation is the step of bringing innovation
within the organisation where it has been decided that what innovation should be bring which
support company to deal with challenges it is facing (Tsai and Wu, 2015). These ideas are
basically formed on the bases of the innovational strategy after deciding a key path or area that is
required to be improved. This can be done by analysing the available information within a
meeting or by adopting brain storming technique. For instance, after conducting a detail analysis
over market challenges faced by company it can arrange a meeting for its expertise where they
can discuss their ideas so that best could be selected to further proceed. This step mainly focuses
over the development of culture which brings creativity by harnessing knowledge from both
inside as well as outside to the organisation. The good idea is generally bring out from the blend
of technology, market requirements and customers.
Prioritization:- After analysing the internal as well as external environment and then
creating a list of ideas over which a company can work in order to bring innovation and

enhancing their performance. Next step is to prioritize these idea as per the benefit and results it
provide after implementation. This can be done after setting up efficient decision making process
that help in ensuring that an appropriate idea must be selected with an aim to get progress over a
new product, service or process (Haar, 2018). For instance, selected ideas of its staff members
can be analyse as per their capability of delivering benefits to company and customer as well,
which then prioritizes to work in achieve organisational goals. These prioritization is usually
done to create a portfolio of ideas or action that can be taken in order to improve the operations
within an organisation. In addition to this innovational portfolio is also matched with innovation
strategy to determine whether the idea prioritisation is as per the target or required some
modification toward the achievement of objectives.
Implementation:- Once all the research has been conducted or strategy has been formed
the next is to bring this plan into action by implementing all the activities that has been decide in
order to achieve the desired objectives. Under implementation phase all the knowledge, skill as
well resources are gathered and implemented to bring innovation as per the plan. In order to
achieve success in this phase a project manger is required to develop an effective and high
skilled cross functional team (Kerl and Moehrle, 2017). It refers to a group of people who are
expertise and have a experience of different fields. This will help in providing an opportunity
where innovation can be quickly and efficiently implemented which bring progress at
marketplace. But before commercialising innovation, project manager first create a prototype of
the innovation which they had decided. This prototype will be move through several test as well
as analysis in order to determine defects involve in this model. After determine the issues involve
in prototype model it has been rectified by the technical team and then final model will be
produced for commercialising in market. These all support company in implementing innovation
effectively and achieve success at marketplace. For instance, a company should firstly produce a
model to which they are planning to bring in market to determine the way in which it work and
what errors could be found throughout its operations so that these can be rectified before it went
to customer.
People and organisation:- This section focuses over determining the need of human
resources for the implementation of innovation. After identifying the human resource required
for innovational implementation, company started hiring the skilled employees. After recruiting
the employees next step is to providing training to the new as well as existing employees

regarding the work they have to perform for bringing innovation (Nadda, Dadwal and Rahimi,
2017). After preparing the employees for their work to be done, job is assigned to them as per
their skills and capabilities so that task can be accomplished effectively. For instance, if a
company is planning to launch a technical devices then it is required to hire technical expertise
and provide them training regarding the way in which devices should be manage, operated and
errors could be tackle. Apart from human resource management, organisational improvement is
also very essential which includes developing a creative culture within the organisation which
easily accept the innovation. In addition to that, this step is also focuses toward improving the
organisational structure which put emphases toward inviting innovational practices within the
company that leads to its success.
These all are the factors that help a company to consider all the essential factor related
with innovation that help in bringing organisational success by improving the way of doing work
or providing services to target market (Meng and Brown, 2018). The Pentathlon framework of
innovation help in filtering the ideas and then extracting the best one to fit within organisation
which help in providing success at marketplace. But apart from all these benefits it has some
disadvantage also like this framework is very time consuming as after forming up strategies there
would be deep evaluation of ideas for accomplishing strategical objective. These ideas will
further validate as per situation and then prioritise which take up a lot of time. As a result of
which sometimes companies will not be able to launch its innovation on time.
PART 2
Application to Terracycle
Introduction to TerraCycle:-
Terracycle is a private company of US which work as recycling business and
headquartered in Trenton, New Jersey. It runs a program of volunteer-based curbside collection
where non-recyclable pre-consumer and post-consumer waste (Lepoutre, Read and Margery,
2017). This collected waste is then used to turn it into a raw material that can be further used to
create a new product (TerraCycle, 2019). Terracycle licenses its name as a manufacturer of
around 200 products hat are made up of using raw material which they create using waste
collected from various corporate donors. This company work toward Eliminating the waste by
recycling the product whether it is a coffee capsules, pen or plastic gloves (Wallace, 2015). It

collect and recycle every type of waste by partnering with individual collector such as major
consumer product companies, manufacturers, retailers, municipalities as well as small businesses
worldwide. TerraCycle perform its operations in more then 20 different countries with an aim to
divert the million pound of waste from landfills and incinerators every month.
Historical discussion of innovation:-
TerraCycle started performing its operation in 2001 and started partnering well known
brands like Procter & Gamble, L'Oreal, national geographical channel and many more in order
develop a concept of recycling and eliminating wastage (Shaw and Allen, 2018). Company
started with an innovative idea related to making of quality fertilizer from the waste food
material. Later it started bringing innovation in their operations for growing within the market
these includes:
Year Innovation
2008 Terracycle run an innovative ad campaign on Newsweek's green issue and
request readers to remove its cover and fill up with used plastic bags. Over
47000 people returned it to Terracycle which then upcycled to make world's
first reusable tote bag (TerraCycle's History, 2019).
2011 TerraCycle team of Brazil broke world record by creating a recycled
sculpture from waste and launch its first online game regarding
repurposing difficult-to-recycle waste. This help in encourage people to
minimise wastage.
2014 At the beginning of this year TerraCycle launches a Zero Waste Box
division with an aim to bring recycling solution fro each type of waste.
These boxes has been formed and then installed at different locations that
have a capability to recycle everything ranging from the coffee capsules to
three ring binders.
2015 TerraCycle partnered with Unilever with an aim to collect deodorant
canisters at Drogerie Market with in Germany in order to recycle this waste
and convert into bicycles. These cycle were then donated to children by
organising several charity programs.

2017 TerraCycle partnered with Procter & Gamble and SUEZ with an aim to
create world's first recyclable shampoo bottle which is made up with plastic
that has been collected from waterways and beaches.
2018 In England TerraCycle has worked toward creating an outdoor gym that is
made up with recycle aluminium canisters. It is also awarded for creating a
first playground that is made up from recycled beauty products.
Future innovation pathway:-
TerraCycle has a great history of success and innovational operation which it had
performed in order to expand its business with totally a new concept and improving the living
standard of society (Hira and Reilly, 2017). Now, company is planning it innovate a new system
or product which help in enhancing its recycling activities and level of business performance that
give maximum result. So, in order to implement this innovation effectively Terracycle may use
innovational model named as Pentathlon framework which work over five core element of
innovation. The implementation of model is explained below:
Innovation strategy:- After performing a deep analysis over its historical performance
as well as external environment, Terracycle is required to bring more innovation in order to
reduce the wastage and increasing the speed of recycling (Sung, 2015). So, it formulated a
strategy to bring such a system that will be able to remove the wastage from several localities
and recycle them in more useful form.
Ideas generation:- Team members of TerraCycle held a meeting and from historical
analysis there are number of ideas has been given by them (Lin, Wei and Zhu, 2015). It includes:
 A recycling software in which people can upload the picture of waste and then explore
different things that they can made from waste material. This help in reducing the
quantity of wastage.
 A small sized Energy storage devices that can be purchased by people ad use it for their
household purpose. This device will be filled up by people with waste which then
process that garbage and convert it into electricity. This can be further used by people
which not only saves electricity but also reduce the risk of shock or any sort of accident.

 Terracycle can also bring drones which move to locality each week in order to collect
the waste material and recycle them into more useful thing. The storage part of drone is
divided into three section which includes plastic bottles and metallic waste. These waste
would be placed by people within drone and it will reform it into more creative and
useful thing.
Prioritization:- After performing a detail discussion from the meeting held among
TerraCycle team number of ideas has been evaluated and prioritize as per the level of objective
completion it will provide to company (Halbfas, 2017). So, it has been decided that out of all the
given ideas 'recycling drone' is consider to be most important and reliable option to opt for
improving the recycling procedure. Hence, recycling drone will be at priority for the company
which help them in achieving success in organisational objectives. Once it get acceptance then
TerraCycle will move toward bringing the recycling software and then they work toward
creating small device named as “Energy storage devices ” for saving electricity.
Implementation:- Once the innovation has been decided, next step is to work over
executing it. Under this TerraCycle is required to take permission from its board member after
performing a feasibility analysis so that they can get adequate support as well as finance to work
over this plan (Danaher, Biggs and Mark, 2016). After getting approval from its board members
company is also required to take licence from the government for using drone in performing
business operations. Once government permit the licence to TerraCycle it can start working over
this plan by arranging drone, creating software for functioning of drone and hiring employees to
track the place it move as well as work performed by them.
After arranging all the resources, TerraCycle first launch a prototype of its model in order
to test the defects it have or improvement that must be performed for the model success. In
addition to this it also help in identifying the reliability and durability of “recycling drone”.
People and organisation:- For the implementation of this plan i.e. “recycling drone”
effectively, TerraCycle is required to hire new technical staff with adequate skills and
competency that have a capability to handle the drone and its operations. This is to done over the
software that has been formed to track the actions performed by drone in order to ensure that
each work must be perform effectively without any type of inconvenience to people.
Business model:-

TerraCycle follow a business model which help it in performing its operations in
effective manner and achieve success at marketplace (Bocken and et. al., 2016). Following
factors describe about the business model used for implementation of recycling drone: Ideation:- It totally depends upon identification and conversion of waste into resourceful
material that further adds value in the business transactions of an organisation. Concept design:- After forming the idea, concept of recycling drone will be formed to
implement the plan into action that includes forming up a plan for the design of drone as
well as ways in which it operates. Prototyping:- Once a concept has been design then technical team will work over it and
form up a prototype model for identifying how it will look and function after its
manufacturing (Massa, Tucci and Afuah, 2017). Experimenting:- The prototype of Flying drone will then move through a detail analysis
for identifying changes required within the model so that proper rectification can be done
to produce a drone that work effectively towards the goal of company. Detail design:- After identifying all the errors and mistake prototype have, TerraCycle
will work over improving it form up a detail design for the final model. From this design,
drone will be formed by considering all the mistake done previous in design. Piloting:- Once the recycling Drone has been formed it will be sent to some location like,
beach for pilot testing to determine its how it will function after getting launched in
marketplace.
 Launch:- After pilot testing has been done, it will be then launched within the
marketplace and send to the places that TerraCycle choose for its operations (Carayannis,
Sindakis and Walter, 2015).
CONCLUSION
From the above given information it can summarised that innovation plays an essential
role within the success and growth of a company as it help them in dealing with competition as
well as customer expectation within this dynamic environment. For implementing innovation
effectively a company must use Pentathlon framework of innovation which provide a pathway to
implement innovation effectively within a organisation. This model also link human resource

with innovation plan that support in successful implementation and execution of innovation at
marketplace.
TerraCycle has great history of innovation in bringing several new methods to recycling
the product into more resourceful manner. Now, it is expected that company will further bring
new innovation to simplify its business operations. So, it has been found that Terracycle will
now bring recycling drone in ordered to identify the waste and converting them into useful stuff
by collecting waste from different locality. The reason behind this innovation is that it is not
possible for company to send people everywhere to gather waste and recycle it, so for this drone
has been formed which collect and recycle waste. This innovation has been drawn from historic
innovational analysis with an aim to have better result by implementing this plan through
business model follow by company that provide a surety of its success.