Amazon Company Background - Research Paper Example

Amazon.com Inc. Company Background Amazon.com, Inc. is a leading online retailer with the headquarters of its electronic business based in Seattle, US. The company which was founded in 1994 began with online sale of books. Currently, Amazon.com provides its worldwide customers and consumers with a variety of products and services including electronics, photography, DVDs, music, camera, shoes and clothing apparel. The features of the company’s products and services include customer review, one click online shopping and e-mail or online order verification (Datamonitor 2). To chive business success, the company has applied corporate strategies which include formation of coalitions with other retailers. Additionally, the company has devised various approaches of gaining competitive advantage in the market. This research paper focuses on Amazon.com Inc. with a view of analyzing and discussing its network relationships, management of intellectual property, strategic position in the network and competitive advantage. Additionally, recommendations are given for the company, so that appropriate approaches are applied in enhancing its success within the framework of its successes and failures. Management of Network Relationships For effective management f its network relations, the company has, in addition to its Seattle headquarters, an additional office at Coffeyville, state of Kansas. Additionally, Amazon.com has global websites in the US, UK, France, Germany, Canada and Japan with a view of serving the domestic consumers of its products and services (Meng 374). With more than eight thousand full time employees, the company is able to have effective communication with its customers within the online or network relationships. In this regard, the placing of orders, acquisition of relevant information, following the progress of the order and online sale of products and services are transactions which are effected during the network relationships. The company values its employees as the most important resource in effective management of network relationships between the company and its employees (Marketwatch 208). The management of network relationships includes effective and efficient communication between the Amazon sellers and the customers. Customers are provided with an interface of creating user accounts through which their communication with the sellers will be facilitated. Through these accounts, the users are able to view the company’s variety of products and make necessary inquiries. This is then followed by making or orders by the customers. The orders are consequently processed by the company’s employees within the various subsidiaries and retail shops. The company’s policy provides for professionalism and effectiveness in communication which includes giving the customers appropriate feedback on the progress of the orders. Additionally, the procedure of communication within the company is in support of enhanced relationship between the sellers and the customers. This is aimed at ensuring effectiveness and quality in the provision of services and products to the company’s market. Call Centers for Facilitating Relationships The company has call centers Kennewick, Grand Forks and Huntington within the US. Additionally, Amazon.com Inc. has call centers in Cape Town, South Africa and Hyderabad, India. These call centers play the most significant role of enhancing network communications between the customers and the sellers of the company’s products (Ratnasingham 1). The activities in the call centers employ information and communication technology in addition to the utilization of telecommunication networks in order to efficiently meet the needs of consumers for information. More importantly, the consumers are enabled to inquire about the various details on the company’s products and thus achieve an enhanced shopping experience. In addition to the communication with the customers, the data centers play a role of coordinating the activities of the various retail ships of the company across the world and thus promoting the communication within the Amazon networks (Meng 378). Costs and Benefits The greatest costs that the company incurs in its online relationships are the maintenance of its digital content and databases. The digital content acts as the interface between the sellers and the customers because it is through digital technology and the internet that the consumers are able to access the digital content within the company’s database. The expenditure of the company on the digital content consequently leads to the yielding of benefits from the sale of digital products such as diverse online information sources. The benefits that the company accrues from the sale of its digital content to the customers are demonstrated by the increased return on sales. For example between the year 2002 and 2003 the company registered very high increase of its annual sales from $3.93 billion to $5.26 billion (Marketwatch 209). In this sense, it is arguable that it is through effective management of the company’s online relationships that it has been able to register benefits of increased revenue. Nonetheless the company has faced challenges in the management of the online networks which has led to failures such as inability to secure the online content adequately. This in return has caused specific periods of inefficiencies on the company’s online network due to the attacks of malicious software. However, the success of the company is attributed to its ability to manage challenges and overcome its failures. Evolution Online Communication The evolution of the company’s online relationships is demonstrated by the increased features within its websites which allow the consumers to access a variety of services and products (Datamonitor 5). This is due to the innovativeness and creativity of the company’s employees in the design and presentation of online content in the most effective manner. As a result of this the network communication software and the related technologies have been updated. This reveals the evolution of the supports that the company has for its customers within the network communications. It is thus through effectiveness of the company in enhancing network relationships that the satisfaction of the company on its services and products has been achieved. This is illustrated by the fact that Amazon.com Inc. was ranked in 2002 as the highest scoring company in the Customer Satisfaction Index within America. The information sources databases of the company have also evolved to allow consumers to have a preview of the various e-books and thus made informed decisions on matters of purchase. More importantly, the company has enhanced the ordering system, purchase and making of payment. This is demonstrated by the easy and speed at which one is able to make a purchase from wherever in the world and thus be enabled to meet needs for information or products. Additionally, the company’s online content has established network relationships with reviewers of its online content. Users have been accorded the opportunity of submitting reviews of its products on the various web pages. It I through rating scale in the review process that users have been able to contribute their evaluation to the company’s products. The evolution of the company’s network relationships is thus demonstrated through the feedback that the customers are enabled to give back on the products through voting and submitting reviews (Research and Markets 1). Relationship with Partners The ability of the Amazon.com Inc. management to build trust with its business partners is a sign of effective network relationships (Marketwatch 211). The skilled and experienced management team of the company in addition to the effective corporate culture has led to the building of trust between the company and its business partners. The company’s partners who include Drugstore.com, Pets.com, Homegrocer.com, Gear.com and Sotheby’s Holdings have had good professional, economic and legal relationships Amazon.com Inc. and its management team (Weeks 139). This has been achieved through effective network relationships between the management team and employees at Amazon and the partners. More importantly, the company has enhanced relationship within its online supply chain through effective communication. Information system applications and their implementation at Amazon.com are attributed to the company’s enhanced network relationships. Nonetheless, it is argued that the network platforms, infrastructure and the use of online communication is the basis for the company’s success in effective network relationships with its customers, partners and service providers (Marketwatch 209). Management of Intellectual Property The company’s electronic materials comprise of its intellectual property. This property is provided by the company in various formats such as e-books, MP3s, music, video, animation, graphics and audio (Research and Markets 1). To safeguard its intellectual property, the company has employed various strategies of digital right management with a view of ensuring that infringement of these rights by malicious users is prevented. Amazon Publishing is responsible for the presentation of online content to the company’s consumers. The publishing of online content by the Amazon Publishing is aimed at ensuring that it protects the information sources and music from infringement of intellectual property rights. The company is legally allowed to operate its online products and services and thus adheres to the intellectual property law in ensuring that it its exclusive rights for its online content are not infringed (Meng 386). Nonetheless, the company acts to protect the intellectual property rights of the originators of its online content such as authors. Through the protection of the company’s intellectual property rights, therefore, the originators of the ideas presented by the company are also protected from possible misuse of their ideas. It is important to note that there is continual evolution of the intellectual property rights within various countries. The use of the company’s intellectual property is thus protected by the international conventions on the use of intellectual property in addition to the legal frameworks on intellectual property within the countries of its operation (Datamonitor 10). It is through the protection of the originators of the company’s digital content that innovation and invention is encouraged within the online community and the society in general. More importantly, the owners of the intellectual property that the company presents to its customers are enabled to enjoy the incentives of their creations (Marketwatch 208). This consequently promotes economic growth within the book industry. Nonetheless, the presentation of the company’s intellectual property to the customers promotes research, education and professional practice. This is due to the company’s role of ensuring public access to intellectual property which is the major source of information to the society. It is in this regard therefore that it can be argued that the company contributes to developments in education and the economy in general. Recommendations Improved Strategic Position in the Network Even though Amazon.com Inc. has gained a strategic and advantageous position within the online networks, it is notable that the competition in the industry is increasing. This is due to the improvements in technology in addition to innovativeness and creativity in the design and production of online tools. In order for the company to achieve an improved strategic position within the online network, it is recommended that it employs effective corporate strategies for its online products and services. This includes increasing its acquisitions of the online content retailers so that it would gain an increased market share and thus an improvement of its strategic position within the network. More importantly, the company should implement effective management of its human resource. This approach will ensure that hiring and retention of skilled and experienced employees is achieved (Weeks 139). Moreover, the employee management scheme should include proper compensation and thus motivation of the employees for creativity and innovativeness in the production and provision of online content and services. The management team should also ensure that there is proper coordination and communication within the online community in order to enhance relationships within the networks services. Nonetheless, the company should not change the role of its network. This is due to the fact that the company has established its brand throughout the world market. Instead of changing its online roles, the company should utilize the opportunities of improving its services and products. This includes the application of creativity and innovativeness in the production and provision of services to ensure that the customers are satisfied. Through the satisfaction of the customers, the company will be able to attain their loyalty and thus increased returns on investment (Ratnasingham 1). Market Structure and Value Creation The company’s structure defines the structure within the market. This means that the company must endeavor to reduce possible bureaucracies within its structure which reduces the efficiency of operations of its network. Therefore, the organizational structure should be flexible in order to ensure that the management of the company’s activities in the various markets meets the needs of consumers. The structure of the company is internationalized because online services and products are provided to its consumers across the world. To improve its market structure, the company executives must support the creation of more call centers so that the communication with the consumers in various markets is enhanced. This will eventually lead to improved relationships within the network (Weeks 139). Nonetheless, the creation of value for the company’s products and services would be created through effectiveness and efficiency in addition to provision of the best quality in the market. IT for Competitive Advantage Amazon has employed the use of information and communication technology in the provision of its services. This is illustrated through implementation of online promotion as the marketing strategy for its products (Marketwatch 207). However, it is recommended that the company employs effective information system within its management function. This will ensure that the employees who comprise of the company major key to success are properly managed. Moreover, the implementation of more creative information system applications will ensure increased coordination of the employees and enhanced relationships with the employees. The implementation of information system strategy will in return lead to competitive advantage of the company within the online market and networks. More importantly, information systems will consolidate the company’s international market through efficiency in communication and thus win the loyalty of the consumer. This situation will in return lead to a competitive advantage of the company in the market through increased market share and returns in investment. Works Cited Datamonitor. "Amazon.Com, Inc." Amazon.Com, Inc. SWOT Analysis (2011): 1-11 Electronics Business Journal . "Amazon.Com, Inc.; Amazon.Com to Acquire Kiva Systems, Inc." Electronics Business Journal, 2012: 172. Marketwatch . "Company Spotlight: Amazon.Com, Inc." Marketwatch: Global Round-Up 5.6 (2006): 207-211. Business Source Complete Meng, Ding. "Perfect 10 V. Amazon.Com: A Step toward Copyright's Tort Law Roots." Berkeley Technology Law Journal , 2008, 23.1: 373-403 Ratnasingham, Paul. A SWOT Analysis for B2C E-Commerce: The Case of Amazon.Com. Hershey, United States, Hershey, 2006, 1 Research and Markets. "Research and Markets: Amazon.com, Inc. (AMZN) - Financial and Strategic SWOT Analysis Review -2012." Business Wire (English): Regional Business News, 2012, 1 Weeks, Tiffany. "Amazon.Com V. Barnesandnoble.Com, Inc." Berkeley Technology Law Journal, 2002, 17.1: 139 Appendix Company structure (Retrieved from Amazon.com) Read More