Thursday, July 22, 2010
Innovation In Waste Management
I love to see real innovation and great management. Lately, I've had less of those topics, and a lot more than I have desired about government interference with and takeover of the private sector.
So I was pleasantly surprised yesterday to see a commercial for Bagster from Waste Management. It took me about 10 seconds to realize how clever the men and women at WM were to have conceived and implemented this product/service.
Bagster is essentially a do-it-yourself dumpster that you can buy at, according to WM's Bagster website, "your local home improvement retailer."
Home Depot is the retailer currently mentioned on the website.
The website and commercial advertise a 3,300 pound payload for the product. It's basically a huge, near-dumpster-sized heavy-duty plastic bag with giant handles.
When you've finished filling it, you call WM and they arrive to remove your filled Bagster single-use dumpster.
What a clever extension of WM's waste removal skills. Unlike Bloomberg's attempted expansion into online legal search, which requires attacking an existing business with strongly-entrenched competitors, WM is opening up a new product/market.
At present, you need to either rent a dumpster, hire someone with a truck, or make endless trips to your local dump, it you have one, to dispose of your renovation debris and waste.
I absolutely love this story. And, as the nearby five-year price chart for Waste Management and the S&P500 Index illustrates, the company has done a good job outpacing the index over that period, though it seems to have fallen to parity in the past year.
Over the past few years, Waste Management has evidently done much work on its internal processes, including their trumpeting of co-generation of energy from the waste disposal which they manage. Their green trucks have led the public to identify them with a sense of recycling, no matter how appropriate that actually may be.
But, in a business that wouldn't seem to contain all that much innovative potential directed at customers, WM has shown there is room for Schumpeterian dynamics even in the retail waste removal segment.