About The Company

• Amazon has now become an umbrella company with two major divisions, which
are,
Physical logistics
E-commerce
• Amazon currently has more than 600,000 employees working in different teams ,
Two pizza teams
• If they want to launch a new category, they find people from different
backgrounds who may or may not have anything to do with the category and
provide them with capabilities to work on their own.
• High decentralization means that company has hard time maintaining a common
culture across its teams.
• One of the major arguments for extensive decentralization is that it increases the
decision-making velocity.
 VISION and MISSION

• VISION
“to be Earth’s most customer-centric company, where customers can find and discover
anything they might want to buy online.”
• Mission
“We strive to offer our customers the lowest possible prices, the best available selection, and
the utmost convenience.”
More Volume

More Customers Lower Cost

Lower Prices

Figure 1: Amazon's virtuous circle

• Amazon’s mission and vision statement lack a mention of their offline
services like brick and mortar stores, and has references of its online
services, which can be understood by the fact that its e-commerce
division generated revenue at the time when its other business
divisions couldn’t come to rescue.
• The vision statement is abstract enough to justify their expansion in
unrelated and sometimes competing businesses. Their customer
obsession and objective of providing convenience explains their
investment in drone technology and data analytics.
Structure Audit
• The organizational structure in place at Amazon.com Inc. is a matrix
organizational structure
1. Function – based groups
2. Hierarchy
3. Geographic divisions
Function – based groups
• Every business function has its own team with a dedicated senior
manager
• The size of teams must comply with the “Two-pizza” rule , wherein
each team must be small enough to be fed by two pizzas
• This form of functional teams enables growth and easy expansion in
new markets.
Hierarchy
• Amazon follows a vertical line of command and influence from the
top which is evident throughout the organization.
• Jeff Bezos, the CEO is at the top with all divisional heads under him
and so on
• This facilitates managerial control of any particular division or even
the entire organization.
Geographic divisions
• Amazon has two divisions based on geography
North America
International
Cultural Audit
• Great work culture is created through organizational stories and
organizational heroes, but, Amazon has failed in both of these
criteria, thereby creating a toxic work environment.
• Some employees feel compelled to stay due to the damages they are
required to pay for breaking a contract they signed while joining
• Many employees and newspapers have criticized the company for its
lack of work-life balance and constant stress without any amenities
• In 2014, around 2400 workers walked out of their offices demanding
better compensation
• In 2018, Amazon finally increased its minimum wage from $7.50 an
hour to $15.
Amazon Swot Analysis
• Strengths

• Able leadership under Jeff Bezos

• Weaknesses
• Customer satisfaction as their primary Goal

• Huge Number of business which are interlinked can add to their • Operating in Variety of business which makes them lose focus on
advantage. the main business

• Deep pockets can pay huge salaries for trained professionals and
Esops program
• Adapted to the changes and shown continuous growth
• Still not a profitable business model for online retail in India
• High Employee attrition rate and employee firing is also very high
• Due to numerous Mergers and acquisitions cultural differences
with the existing employee

• Opportunities
• Threats
• With changing technological trends and increasing internet
penetration huge opportunity to grow • With all the competitors focusing on the employee’s job
satisfaction Amazon has blind eye.
• With the data amazon possess can develop new business models.
• Walmart its biggest competitor is heavily investing in online
• Investments in next generation business by AI and Aerospace market place
business with Blue origin has huge potential to grow.
• Microsoft and IBM are investing in Cloud infrastructure and
challenging its leadership
Gap assessment

• Look and feel of the website

Misspellings
Unanimous Reviews
Problems

• High standards and expectations from managers – Employees are

expected to work on weekends and from home as and when required
• As a result, no work-life balance
• Follows a ranking system which promotes competition among the
employees
Solutions

• Employee friendly work culture ( productivity deceases drastically

after 50 hours a week of work and becomes close to nil after 55 )
• Redesign the performance management system, ranking system
should be removed
• Teach and promote healthy conflict, reduce the feeling of cut throat
competition
• In 2014, around 2400 workers walked out of their offices demanding
better compensation