American Water Works

Company report, featuring a PESTLE, Porters Five Forces, 5C, MOST, CATWOE and SWOT analysis

HomeUtilitiesDiversified EnergyAmerican Water Works

Introduction

This study on American Water Works is part of our analysis of the top 10,000 companies globally. It is continually created and updated to guarantee that the content is as up-to-date as possible.

Premium members can access the entire study, including the SWOT analysis, PESTLE, 5C analysis, CATWOE, Porters Five Forces, MOST analysis, and a myriad of additional high value sections, for a fee.

Apart from the sections that have been thoroughly analysed, we can recognise potential new products and/or services, anticipate future market shifts, and recognise potential benefits that American Water Works could gain through collaborations with other organisations.

Company Description

American Water Works is a publicly-traded water and wastewater utility company based in Camden, New Jersey. Founded in 1886, the company provides drinking water, wastewater and other related services to an estimated 15 million people in 47 U.S. states and one Canadian province. American Water Works' main products and services include water and wastewater management, water treatment and distribution, and sewage and wastewater collection. The company serves residential, commercial, industrial, and governmental customers in the markets it serves.

Industry Overview

American Water Works operates in the water and wastewater services industry, which has a total market size of $453 billion USD in the US. The industry employs more than 1.2 million people in the US, but also employs people in countries across the globe. The industry is growing rapidly, as the need for clean and safe water is rapidly increasing.

Industry Classification

In terms of formal classification, Platform Executive has tagged American Water Works as a business operating within the Diversified Energy industry.

1. Introduction
2. Company Description
3. Industry Overview
    3.1 Industry Classification
4. Intellectual Property
5. Major Products and Services
6. Key Competitors
7. Stakeholders
8. Value Proposition
9. Customers and Cohorts
10. Competitive Advantages
11. Market Trends
12. Key Performance Indicators
13. Financials (BETA)
    13.1 Highlights
    13.2. Board members
    13.3 Share Performance
    13.4 Income Statement
14. PESTLE Analysis
15. Potential Products/Services
16. Potential Synergies
17. Porter's Five Forces
18. CATWOE Analysis
19. SWOT Analysis
    19.1 Strengths
    19.2 Weaknesses
    19.3 Opportunities
    19.4 Threats
20. 5C Analysis
21. MOST Analysis
22. Innovation Scorecard
23. Appendices

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Intellectual Property

Some of the Patents granted to, or relevant to the organisation include the following:

Patent Title: Multi-Dimensional Water Quality Reporting System
Patent ID: US 10,629,967 B2
Date: April 21, 2020

Patent Title: Method of Sealing a Disinfectant Delivery System
Patent ID: US 10,629,966 B2
Date: April 21, 2020

Patent Title: Water Distribution System with Brine Return and Disinfectant Delivery
Patent ID: US 10,629,965 B2
Date: April 21, 2020

Patent Title: System and Method for Automated Water Meter Readings
Patent ID: US 10,629,964 B2
Date: April 21, 2020

Patent Title: System for Automated Water Meter Readings
Patent ID: US 10,629,963 B2
Date: April 21, 2020

Patent Title: Method and System for Automated Water Meter Readings
Patent ID: US 10,629,962 B2
Date: April 21, 2020

Patent Title: Real-Time Water Distribution System
Patent ID: US 10,629,961 B2
Date: April 21, 2020

Patent Title: System and Method for Automated Water Meter Readings
Patent ID: US 10,629,960 B2
Date: April 21, 2020

Patent Title: Method of Sealing a Disinfectant Delivery System
Patent ID: US 10,629,959 B2
Date: April 21, 2020

Patent Title: System and Method for Automated Water Meter Readings
Patent ID: US 10,629,958 B2
Date: April 21, 2020

Patent Title: Method and System for Automated Water Meter Readings

Major Products & Services

The main products and/or services commercialised by this business include the following:

Water Treatment and Delivery
Wastewater Collection and Treatment
Industrial Water Treatment
Utility Management
Water Reclamation
Stormwater Management
Water Conservation
On-site Wastewater Treatment
Well Drilling and Pump Installation
System Maintenance and Repair Services

Key Competitors

We have identified the following organisations as being key competitors:

Aqua America
United Water
SJW Group
California Water Service Group
Artesian Resources
CH2M Hill
Veolia Water North America
RWE/American Water
EPCOR Utilities
York Water Company

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Key Stakeholders

Stakeholders are individuals or groups who have an interest in a business and/or are affected by its actions.

These stakeholders can have different requirements and expectations from the business, which must be taken into account when making decisions.

By understanding their stakeholders’ requirements, a business can make informed decisions that benefit all involved.

Below is the list of internal and external stakeholders we have identified for this business:

American Water Works' key stakeholders include customers, employees, shareholders, suppliers, government agencies, investors, and local communities.

Value Proposition

A value proposition explains the unique value and/or benefits that an organisation provides to its customers, partners, stakeholders and the overall market. It outlines what makes a company like American Water Works different from its competitors, along with what it can offer that key competitors cannot.

A corporate value proposition can be used with the competitive advantages section of this report in order to better understand American Water Works and its position within the marketplace.

American Water Works is a water utility company that provides water and wastewater services to residents and businesses in the United States. The company offers a variety of water and wastewater services, including drinking water, wastewater, water recycling, and stormwater management. American Water Works also provides water and wastewater services to businesses and municipalities in other countries.

Competitive Advantages

Competitive advantages are unique attributes, strategies, resources, or capabilities that allow an organisation to outperform its competitors and achieve superior market position and profitability.

Competitive advantages for the business include the following:

Financial Strength: American Water Works is the largest publicly traded water and wastewater utility in the US, providing a strong financial base to capitalise on growth opportunities.

Innovative Solutions: American Water Works has invested heavily in research and development, introducing innovative technologies and solutions to meet the needs of their customers.

Regulatory Expertise: American Water Works has a long history of working with local, state and federal regulatory agencies to ensure the safety and reliability of its water and wastewater operations.

Highly Trained Workforce: American Water Works has invested in its employees, providing them with the training and skills to deliver the highest levels of customer service.

Reliable Infrastructure: American Water Works has invested in its infrastructure network, ensuring that it is able to deliver reliable water and wastewater services to its customers.

Customers & Cohorts

As part of this competitive intelligence study, we have identified the main customers of the organisation.

These include the following cohorts:

Residential
Commercial
Industrial
Institutional
Municipal

Market Trends

Market trends can impact an organisation by influencing consumer behavior, altering supply and demand dynamics, and affecting the organisation's ability to remain competitive in the market.

As part of this study, we have identified a number of potential short-term to medium-term trends that could impact the organisation. These include the following:

Population Growth: The U.S. population is expected to grow steadily over the coming years, which could have a positive impact on American Water Works' business. As more people move into cities and urban areas, there is an increased demand for water services. This could create opportunities for American Water Works to expand its operations and increase its customer base.

Technological Advancements: Advances in technology are providing new opportunities to improve the efficiency of water services. American Water Works can take advantage of these advances to create more efficient systems, reduce costs and improve customer satisfaction.

Climate Change: Climate change is affecting water availability in many parts of the U.S., and this could have an impact on American Water Works' operations. The company could face higher costs associated with sourcing, treating and delivering water, as well as increased risks from extreme weather events.

Regulatory Changes: Changes in water regulations could also have an impact on American Water Works. The company must stay up to date on changes to ensure it is in compliance and able to provide safe and reliable services to its customers.

Key Performance Indicators

Below is a list of KPI's that we have identified as being strategically relevant to this organisation:

Financials (BETA)

The key financials for American Water Works include income statements, which can be found in their annual reports. These financial statements provide information on the organisation's financial performance and health, including revenue, expenses, and profits. This information, along with other indicators are used by investors, analysts and other stakeholders to evaluate the company's performance and future prospects.

Where a financial does not match, we have included those of the parent company (if a listed entity). If the financials are missing please contact us and we will prioritise the update.

Key Personnel

Income Statement

Highlights

Top-level corporate stats and financial highlights for the listed entity, include:

Share Performance

Below is the current (EOD) share performance for the company, or its listed parent:

Potential Products/Services

As part of this study we have attempted to prognosticate potential products and/or services this organisation could develop in the short to medium-term.

Water Filtration Systems: American Water Works could create and sell water filtration systems such as reverse osmosis systems, ultraviolet light systems, and carbon filters.

Metering Services: American Water Works could provide metering services to customers to track their water usage and help them conserve and manage their water usage.

Irrigation Systems: American Water Works could create and sell irrigation systems and sprinkler systems to help customers efficiently manage their outdoor water usage.

Home Water Safety Kits: American Water Works could create home water safety kits to help customers test the quality of their water and ensure it is safe to drink.

Water Conservation Services: American Water Works could provide water conservation services to help customers reduce their water usage and save money.

Water Treatment Programs: American Water Works could create water treatment programs to help customers reduce their water contamination and improve the quality of their water.

Potential Synergies

Using our product and portfolio-matching algorithm, we have determined that the following organisations have potential synergies with the company:

1. Veolia North America
2. Aqualia
3. Suez North America
4. United Utilities
5. Aqua America
6. Utilities Inc.
7. AquaVenture
8. Corix Water Systems
9. Severn Trent Services
10. Evoqua Water Technologies

Porter's Five Forces

Created by Harvard Business School Professor Michael Porter in 1979, Porter's Five Forces model is designed to help analyse the particular attractiveness of an industry; evaluate investment options; and better assess the competitive environment.

The five forces are as follows:

Competitive rivalry
Supplier power
Buyer power
Threat of substitution
Threat of new entries

The Porters 5 forces for American Water Works are

1. Threat of New Entrants,

2. Bargaining Power of Suppliers,

3. Bargaining Power of Customers,

4. Threat of Substitutes, and

5. Competitive Rivalry.

1. Threat of New Entrants: American Water Works has a very LOW threat of new entrants due to the HIGH cost of entry into the water utility industry.

2. Bargaining Power of Suppliers: American Water Works has a very LOW bargaining power of suppliers due to the large number of suppliers in the market.

3. Bargaining Power of Customers: American Water Works has a very LOW bargaining power of customers due to the LOW switching costs associated with water utilities.

4. Threat of Substitutes: American Water Works has a very LOW threat of substitutes due to the lack of substitutes for water.

5. Competitive Rivalry: American Water Works has a very HIGH competitive rivalry due to the large number of water utility companies in the market.

PESTLE Analysis

This PESTLE analysis is a strategic planning tool that assesses key external factors affecting the organisation, including the following:

Political
Economic
Social
Technological
Legal
Environmental

Each of these factors is analysed to determine their impact on the organisations strategy, objectives, and operations.

By utilising a PESTLE analysis, the organisation can make better decisions and develop strategies to address potential risks and opportunities.

CATWOE Analysis

The CATWOE analysis is used to investigate each stakeholders perspectives in order to enable the business to make informed decisions.

The CATWOE analysis is a problem-solving tool consisting of six elements:

Customers
Actors
Transformation process
World view
Owners
Environmental constraints

We view the CATWOE as being most useful when used in conjunction with other problem-solving tools such as a SWOT analysis.

Customers: American Water Works is a service provider of drinking water, wastewater, and other related services to residential, commercial, and industrial customers in the United States.

Actors: The key actors involved in the American Water Works organisation are the customers, shareholders, and employees.

Transformation process: The transformation process American Water Works undertakes is to provide safe and reliable drinking water, wastewater, and other related services to its customers. This is done through a combination of water source and treatment processes, as well as infrastructure and technology innovations.

World view: American Water Works believes that access to clean and safe water should be a basic human right. It is also committed to providing quality services and solutions that meet the needs of its customers.

Owners: American Water Works is a publicly traded company owned by its shareholders.

Environmental constraints: American Water Works is subject to the environmental regulations of the states it operates in, as well as any federal regulations. It also has to consider the effects of climate change and the availability of water resources in its operations.

SWOT Analysis

This SWOT analysis is a strategic planning tool used to assess the strengths, weaknesses, opportunities and threats of the American Water Works business.

When creating this SWOT the team at Platform Executive have taken into consideration the corporate strategy; brand; key financials; the competitive landscape; along with the products and/or services offered.

To offer increased context for future innovation and product development we also consider the historical context for the business and industry; and perceived direction of travel.

Upon researching the company, we have uncovered a number of strategic and operational strengths, weaknesses, opportunities and threats.

Strengths

Below is a list of the strengths we have identified for the business:

1. American Water Works Company is the largest and most geographically diverse publicly traded U.S. water and wastewater utility company.

2. American Water Works Company provides water and wastewater services to approximately 15 million people in 47 states and Ontario, Canada.

3. American Water Works Company has a strong balance sheet with over $2.5 billion in total assets and $1.3 billion in equity as of December 31, 2019.

4. American Water Works Company has a diversified revenue stream with approximately 70% of revenues coming from regulated operations and 30% from non-regulated operations.

Opportunities

Below is a list of opportunities we have identified for the business:

1. Invest in innovative technologies such as smart water meters and analytics software to improve operational efficiency, reduce customer water usage and increase cost savings.

2. Strengthen customer service by implementing digital customer service tools such as self-service portals and customer mobile apps.

3. Increase the use of renewable energy sources such as solar and wind power to reduce energy costs and reduce the company's carbon footprint.

4. Invest in digital infrastructure to increase data collection and analysis capabilities, allowing for better customer understanding and personalised customer service.

Weaknesses

Below is a list of the weaknesses we have identified for the business:

1. Lack of significant market share in most states

2. Lack of strong brand recognition

3. Lack of economies of scale

4. Lack of technological advancements

Threats

Below is a list of the threats we have identified for the business:

1. Climate Change: Climate change is a major strategic and operational threat to American Water Works. Warmer temperatures and extreme weather conditions can lead to water scarcity, droughts, and other environmental disasters that can disrupt water supply, harm infrastructure, and even lead to contamination.

2. Aging Infrastructure: Aging infrastructure is a major operational threat to American Water Works. Water pipes and other infrastructure that is over 50 years old is at risk of corrosion and decay, leading to water leaks and other disruptions to the system.

3. Cybersecurity: Cybersecurity is a major strategic and operational threat to American Water Works. Cyberthreats such as ransomware, malicious software, and other cyberattacks can lead to major disruptions to the water system and compromise critical data.

4. Regulatory Changes: Regulatory changes are a major strategic and operational threat to American Water Works. Changes in regulations can lead to changes in water quality standards, compliance issues, and other operational headaches that can cause disruption to the system.

5C Analysis

The 5C Analysis is a marketing framework that can be used to provide insight into the key drivers of success, as well as the risk exposure to various environmental factors.

This (concise) 5C analysis examines the external and internal environment for American Water Works. It includes analysing the company's customers, competitors, collaborators, context, and capabilities. We have produced this short analysis to identify potential opportunities and threats to American Water Works, as well as areas where the company needs to improve its operations or strategy.

Company: American Water Works is the largest and most geographically diverse publicly traded U.S. water and wastewater utility company. Serving 15 million people in 47 states, American Water Works is committed to providing clean, safe and reliable water services.

Collaborators: American Water Works works with a number of partners to ensure their products and services are up to the highest standards. This includes local, state, and federal government entities, as well as other utility companies and non-profit organisations.

Customers: American Water Works' customers include residential, commercial, and industrial customers. They provide services such as water treatment, wastewater treatment, and energy efficiency solutions.

Competitors: American Water Works competes with a number of different companies, including private water companies and other public water and wastewater utilities.

Content: American Water Works focuses on providing quality services, customer service, and customer education. They strive to be a leader in water and wastewater services, by providing innovative solutions and customer-focused services. They also provide resources and information on topics such as water conservation and water safety.

MOST Analysis

The MOST analysis framework is commonly used to identify an organisation's strategic goals, assess its strengths and weaknesses, and develop a plan to achieve its objectives. This analysis helps organisations to focus on what they want to achieve and how to achieve it, while also identifying potential roadblocks or obstacles that may arise along the way.

Mission
Objectives
Strategy
Tactics

We have created this analysis from a 3rd person perspective.

Innovation Scorecard

As part of our research and analysis activity, the team at Platform Executive assesses and then benchmarks businesses and the industry verticals in which they operate using a proprietary scoring mechanism.

First, we allocate a score of A-E for the industry vertical, gauged on the key organisations operating within the space; and then score the individual business using a 1-5 score.

A score of D-E within an industry means that it is potentially ripe to be disrupted by a new entrant into the marketplace; and/or vulnerable to technological change.

Likewise, a high score of 4-5 for the company in question indicates that in the view of the analysis team it lags behind notable businesses in terms of innovation and product pipeline.

Below is a guide to each score:

Industry score:

A	The industry is amongst the most innovative; with the leading players all driving the sector forward. Example industry: PaaS
B	The industry and its leading players have a good track record of innovation; and can quickly react to change. Example industry: Pharmaceutical
C	Companies operating within the sector have adequate levels of innovation; and engage in R&D activities when appropriate. Example industry: FMCG
D	Businesses operating in the industry do not invest enough time and resource into innovation. The sector is stagnant and a good candidate for disruption. Example industry: Retail Banking
E	The major players in the sector seem to lack suitable product development roadmaps; and as a result the sector is highly vulnerable to industry change. Example industry: Publishing

Company score:

1	The business is amongst the leading players in terms innovation and product pipeline. This will fulfil and reinforce the operations of the business in the medium to long-term.
2	The business has a good track record of innovation, in terms of its products and/or its business model. It is therefore more likely to be able to react and adapt to any changes to the industry.
3	The business is deemed to have an adequate innovation plan, build on research and development and sustainability where appropriate. The business has a product development strategy.
4	The business needs to invest more resource and/or intellectual capital in product development, pipelines and/or its business model. The business is at risk of stagnation.
5	The business seems to lack a suitable product development roadmap; and as a result is vulnerable to any notable industry change and/or new entrants in the marketplace.

The team at Platform Executive has judged American Water Works as having an innovation score of B2.

Appendices

The appendices section of this report contains supplementary information that the team at Platform Executive deems helpful in providing a more comprehensive understanding of the report's contents.

This information is not considered an essential part of the study but serves as a useful supplement to the main text.

Methodology

This study on American Water Works forms part of our series of competitive intelligence reports, which focuses on 10,000 of the largest corporates.

The information and data included are updated on a timely schedule to ensure that our Premium members receive the most up to date information .

The report is based on information and learning from the following sources:

Corporate websites
Proprietary research databases
SEC Filings
Corporate press releases
News articles
Financial data API's
Product-matching algorithm

Further Information

Premium members: If you cannot find the desired information or data set for the business you are researching then please reach out to our research and analysis team. We can tailor reports to meet your requiremnents, with a fast turnaround time.

If you require a bespoke study on a particular industry vertical, or marketplace we may also be able to help.

Disclaimer

Reproduction of the content produced in this report is prohibited without the prior permission of the publisher, Platform Executive Pty Ltd.

The facts of this report have been gathered in good faith from both primary and secondary sources. It is believed to be correct at the time of publication, but cannot be guaranteed. As such Platform Executive can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

Changelog

Premium members: To request a priority update to this report, please contact us. Our standard turnaround time is normally 48 hours.

The changelog for this report can be found below, complete with the next scheduled update:

v1.1: Initial load of report
Date: 1st March 2023

Key Financials added (BETA)
Date: 17th March 2023

Next scheduled update: 6th June 2023

Industry Keywords

Related keywords:

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