Decision-Making at Amazon - Case Study Example

ORGANIZATIONAL ANALYSIS goes here] s [Due the paper] Organizational Analysis The company which I have selected for analysis is Amazon. Amazon is one of the leading multinational electronic commerce companies of the world. The company has its headquarters in the United States of America. Amazon provides a platform to consumers using which they can buy different kinds of products such as books, toys, furniture, and electronic products. As Rigby (2012) states, “with websites such as Amazon.com, shopping through the Internet has never been as easy and as enjoyable as it is today.” At present, Amazon is the largest online retailer of the world. Jeff Bezos, the founder of Amazon, established the company in 1994. Amazon started its services as an online bookstore, but with the passage of time, it started selling a diverse range of products, which included electronic products, wooden furniture, and many other products. Amazon S3, SimpleDB, Amazon EC2, Alexa Internet, Amazon Studios, Amazon Web Services, and A2Z Development are some of the products, which have contributed significantly to the success of the company. Amazon has a number of competitors. Some of the main competitors of Amazon include eMusic, Elastra, and Alice.com. One of the main differences between Amazon and its competitors is that Amazon deals with a diverse range of products, whereas its competitors deal with a small range of products. It is due to the implementation of an efficient management information system that Amazon has been able to achieve market domination in a short span of time. As Treanor (2010) states, “Amazon has a demonstrated history of consistent behavior since their startup in 1995.” If we talk about the customers or clients of Amazon, we can say that Amazon holds a large number of customers all over the world. Amazon is a retailing company, which provides people with their desired products at their doorsteps. People like to explore the websites of such companies, which facilitate people in buying different kinds of products. Amazon has a large number of customers who prefer to use its cloud computing and web hosting services. Some of those customers include pharmaceutical companies, banks, financial organizations, telecommunication companies, and educational organizations. Apart from these customers, there are also some other customers who want to run their data through hosted services. Such customers also make use of Amazon’s cloud computing services to run their data online in a secure manner. As Kambil (2009) states, “cloud computing promises to provide various information services at a lower cost and change the model of capitalizing IT investment for software entrepreneurs and businesses.” Some people also make use of S3 and EC2 to host their domains and blogs. Other than such customers, there are a number of customers of Amazon, who buy electronic products and furniture using the services of Amazon.com. The system at work at Amazon is a closed system. A closed system is one that does not allow users to change any program or function. In a closed system, users can use only the content without being able to make any changes to the system. Amazon Company facilitates its users by providing them with their desired products but limits them from making any change in the system. Users can use cloud-computing services of Amazon to run their business operations but cannot alter the working of the system. Users have to pay to the company for using its web hosting or cloud-computing services. In an open system, users can make changes in the system as per their requirements. However, Amazon uses a closed system that does not allow users to modify the system. Amazon provides high quality services to the users but maintains the right to keep the system intact. If we talk about the rules and norms of Amazon retailing company, we can say that Amazon strictly adheres to its rules and norms. Amazon does not allow any employee or user to modify any aspect of its online system. Amazon strictly adheres to its rules regarding maintenance of privacy of its official reports and business strategies. Every employee of Amazon has an obligation to work for the benefit of the company. They must also provide the best customer service to the users. Employees also have the obligation to maintain the privacy of the information that people submit to the company at the time of placement of order. Amazon is a company, which has achieved its status in the retailing industry by providing high quality services to the users. The management officials of the company tend to maintain this status by adhering to the rules and norms of the e-commerce industry. As all other online businesses, Amazon also complies with advertising law, employment and labor law, online business law, privacy law, and uniform commercial code. As Amazon is an online company, it strictly adheres to the laws covering online advertising and digital rights. Amazon also focuses attentively on the rules regarding international online sales and collection of sales tax over the internet. If we talk about the hierarchy of Amazon, we can say that there is a separate manager for every department. Jeff Bezos, who is the CEO of the company, looks after the companys matters regarding development of policies and business strategies. Moreover, every department has a manager who supervises the activities of the employees of his/her respective department. The company has also hired a website administrator who takes care of all issues regarding the functioning of the company’s website. At Amazon, both formal and informal forms of communication take place. The communication between employees of the same department is usually informal, as they have to talk to each other regularly on different business matters. The communication between managers of two different departments is formal, as they use emails and faxes to send and receive information. If we talk about the form of communication that takes place between the company and its employees, we can say that it takes place in a formal way. For example, the company’s officials send a properly formatted email to customers on the placement of orders or for receiving payments. Similarly, the company has a proper call center to help users with their problems and issues regarding orders’ placement. Top-down communication in the company also takes place in a formal way. If we talk about organizational orientation, we can say that it falls into the category of authoritarianism. The reason is that all employees of the company adhere to the rule of submission to authority. Every employee has to follow the rules set by the company. Moreover, they need to concentrate properly to the directions of their respective supervisors to perform any task. Employees cannot do anything on their own rather they need to follow the directions of their supervisors. The leadership approach used by the managers of the company is the task-based approach. Managers give tasks to employees and motivate them to show improved performances to achieve those goals. Task-based approach helps managers achieve maximum employee efficiency. Managers using the task-based approach focus on production and delivery results. They want their employees to work hard to deliver best results. Managers make employees aware of their responsibilities toward the achievement of goals and provide them with guidelines to achieve the goals in the required amount of time. It is due to the task-based approach of the managers of Amazon that the company has been able to earn high amounts of revenue in the recent years. If we talk about the form of reinforcement used by the managers of Amazon, we can say that they mostly use positive reinforcement. Although both types of reinforcement result in strengthening the behaviors of employees, Amazon uses positive reinforcement to make its employees show improved performances. The company provides employees with bonuses and rewards to make them repeat their performances. Managers do not use negative reinforcement because they believe that it can put pressure on employees, which may put adverse affect on their performances. Therefore, they prefer to use positive reinforcement to increase employees’ performances. Decision-making at Amazon is a key process as it is in all other organizations. At Amazon, managers consult their employees and business environment to take correct decisions. Managers of Amazon truly believe in the concept of mutual thinking. They believe that consulting is one of the key steps in decision-making processes because it helps a person come up with the most suitable decision regarding any issue. Therefore, they consult experienced and concerned employees while taking decisions on any business matter. Moreover, they also consult business and marketing professionals while developing business policies. The reason is that development of business policies requires managers to take certain decisions on different aspects of the business. Consultation with business professionals can prove beneficial for managers as they can provide a detailed overview of the current and forecasted business scenarios to the managers. Based on my observations and analysis, Amazon seems to grow and expand in the near future. The managers are taking effective measures to make Amazon the biggest online retailing company of the world. I do not see any decline in the graph of the company’s revenue. In the future, more and more people would use Amazon’s web hosting and cloud computing services to ensure smooth running of their business processes. References Kambil, A. (2009). A head in the clouds. Journal of Business Strategy, 30(4), 58-59. Rigby, M. (2012). This is how to sign up for Amazon Prime. Retrieved from http://ezinearticles.com/?This-Is-How-to-Sign-Up-for-Amazon-Prime&id=6890262 Treanor, T. (2010). Amazon: Love them? Hate them? Let’s follow the money. Publishing Research Quarterly, 26(2), 119-128. Read More