Amazon Organizational Behavior: Analytical Essay

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Amazon Organizational Behavior: Analytical Essay

Introduction

Amazon is an American multinational technology company and the largest e-commerce market and computing platform in the world and the second largest employer in the US. It is based in Seattle, Washington and was founded by Jeff Bezos on July 1994. It started as an online library but diversified later to sell everything, which has brought her up to being the most active online selling platform with its distinguished was of leading, communicating and implementation of smart online selling strategies while having 100 million people who are subscribers to Amazon Prime. (wikipedia, 2019) It is a company with around $75 billion in annual revenue, a $140 billion market value.

Organization heroes

At the highest level of Amazon, Jeff Bezos has a team called the “S-Team”. Each one of the team is responsible for a large entity under them. The main heroes are:

“The heart and soul of Amazon” Jeff Bezos, he is the founder and the CEO of Amazon.
Jeff Blackburn, he is an executive and a part of the investment banking team which took Amazon public.
Andrew Jassy, he runs web services. He is a big deal because of running a very important section.
Jeff Wilke, He is effective in building the supply chain infrastructure.

Then comes the CFO, controller…etc. But, the above 4 people are the key players. (franklin, 2018)

Organizational structure

Amazon has a hierarchical organizational structure. Despite its large size, unlike other hierarchical organizational structure companies, Amazon remains highly flexible to adapt to changes in the marketplace. (dudovskiy, 2018)

According to the articles and sites that I have read, I can tell that amazon has a comfortable environment for employees, so they follow an informal internal structure as employees interact directly and easily with head managers through emails and other communication methods.

Decision-making process

Decision-making is a comprehensive organizational process that has an impact on each level in the organization including, individual, group, and organization itself.

Bezos takes a red pen to cross out anything that doesn’t send the simple message ‘You won’t find a cheaper, friendlier place to get everything you need than Amazon’.

The Decision-making process in Amazon includes brainstorming, affinity diagramming, force-field analysis, flowcharting, planning matrix, unilateral decision-making, consultative decision-making, voting decision-making, and consensus decision-making; analyses the utility of decision-making process in organizational settings and investigate their implications for quality management in organizations. (htt)

Amazon is known for being accurate and data-driven.

“You have to realize: decision making isn’t one size fits all,” said Bezos.

To know the difference, said Bezos, ask yourself two simple questions: “What are the consequences of this decision?” and “Is this decision reversible?”

Reversible decisions are a low consequence and reversible. These decisions can be made quickly with data and by junior teams. “If you make the wrong decision,” Bezos explained, “the cost is low.” Large companies can become less intelligent when small, reversible decisions are made using a “big consensus process.” Even if it isn’t the greatest move, going fast will help you get a leg up on the race. “The cost of being slow is so much higher than the cost of getting the answer exactly right,” he said.

Irreversible decisions demand more care. These high-consequence decisions should be made by senior leadership, single individuals or tiny teams. Bezos referred to himself as “a chief slow down officer” Bezos called these types of decisions “one-way doors”.

With huge, irreversible decisions, gut and intuition can play a big role. “People think of Amazon as very data-oriented and I always tell them, look, if you can make the decision with data, make the decision with data,” he said. “But a lot of the most important decisions simply cannot be made with data”.

Leadership style and motivational environment

Amazon is famous for the approach “disagree and commit.” (what’s amazon’s leadership style, 2017)

Comprehensive conversations in which different opinions are expressed are valued. Inclusivity and collaboration are keys to what they are. They pride themselves for being respectful for their employees and willing to listen. Their history has shown them that they get more things done together.

Amazon has a type of e-mail that emerge panic waves. It occurs with annoyed customers complain to Jeff Bezos public e-mail address. He always reads customer complaints and forwards them to the employees, with adding just a question mark. When employees receive the email, they react as they’ve discovered a ticking bomb. They just have a few hours to solve the problems and prepare an absolute explanation for it. Such escalations are Bezos’s way of ensuring that the customer’s voice is steadily heard inside the company.

‘Every story from customer matters, we research each of them because they tell us something about our processes. It’s an audit that is done for us by our customers. We treat them as precious sources of information.’ (stone, 2013)

Here are two ways that Jeff Bezos follows to distinguish his leadership style and his Amazon from others: (blazek, 2016)

a) “Customer is king”

While other internet firms focus on a fun and relaxed atmosphere for their employees, Bezos is proving the effectiveness of another model which is coddling his 164 million customers, instead of his 56,000 employees. Bezos places a huge deal of focus on what the customer wants and doesn’t want. Amazon realizes that consumers hate delays, defects and out-of-stock products. That’s why each of these issues and its smallest detail is continually looked after.

Amazon’s statistics showed that 0.1-second delay in loading a page equals a 1% drop in customer activity, so they work tirelessly to improve the loading rate.

b) “Expect more from your employees”

When Amazon was still just an online bookstore, they had 500 employees for the sole assignment of responding emails. Each one of them was expected to answer 12 emails per minute, and could perhaps be fired if the number dropped below 7.

Working for Bezos isn’t a walk in the park. He has high expectations from his employees and doesn’t apologize for it.

Communication

“Bezos escalation email” is a statement that you can ask people about, it reflects the easiness of access to Jeff Bezos. First, this shows that communication within the organization is fostered by the managers’ accessibility. Second, this shows how responsive and active managers are towards their employees instead of depending on them, even it is an employee complaint or a customer complaint.

Talking about Bezos’s way of communicating, he is pretty strict and straight with being motivationally a great supporting tutor. While in public he seems charming and capable of great humour, in private he explodes into nutters as his underlings say.

If a co-worker fails to meet Bezos’s exact standards he may be fired, and if an employee does not have the correct answers or attempts to bluff, or takes advantages of other’s work, or manifests an uncertainty of internal politics, or weakness in the heat of the conflict, a blood vein in Bezos’s forehead explodes and his filter falls away. He’s capable of overstatement and harshness.

Amongst his greatest hits, collected and delivered by Amazon veterans:

“Are you lazy or just incompetent?”, “If I hear that idea again, I’m going to have to kill myself’, ‘We need to apply some human intelligence to this problem”, after reviewing the annual plan from the supply chain team “I guess supply chain isn’t doing anything interesting next year”, after reading a start-of-meeting memo “This document was clearly written by the B team. Can someone get me the A team document? I don’t want to waste my time with the B team document”, after an engineer’s presentation “Why are you wasting my life?” (Stone, 2013)

‘He is not that kind of person. Jeff doesn’t tolerate stupidity, even accidental stupidity.’

Some employees support the theory that Bezos- like other co-founders- lacks compassion. This leads to him treating workers as expendable resources without taking into account their contributions. That allows him to coldly allocate capital and labour and make hyper rational business decisions, where another executive might let emotion and personal relationships count into the equation. They also acknowledge that Bezos is essentially obsessed about improving the company’s performance and customer service and that personnel issues are secondary.

Bezos’s criticisms are almost always on point. Bruce Jones- a former Amazon supply chain vice president- describes leading a team of five engineers, trying to figure out how to make workers’ movement more efficient and fulfilled. The group spent 9 months on the task. ‘We had beautiful documents, and everyone was really prepared’ Jones says. Bezos read the paper and said, ‘You’re all wrong’ then stood up, and started writing on the whiteboard.

Electronic communication

Technological improvements in workplaces have increased business productivity, quality improvements and efficiency. The emerging challenge is to ensure that technology development, e-communication, knowledge sharing and coordination of organizational activities occur routinely while managing the use and misuse of technology. (Ebsco, n.d.)

The importance of electronic communication in workplace collaboration began to rise in the late 20th century and it includes:

Direct communication (voice or text-based telecommunication devices, computers).
Indirect communication: an intermediate method, including not limited to Internet-based social networks. It shall also include change of signs, signals, writing, images, sounds and data. (electronic communication between employees and students, 2009)

Email, virtual team rooms and other basic interactive tools provided by the Internet were among the first drivers of dispersed work teams. These tools enable companies to have employees collaborate on projects economically, even when they are located in different parts of the world.

Diversity

A result of the availability of greater electronic communication tools is the increased ability of companies to develop diverse workplaces. Electronic communication tools make it easier for companies to provide diversity training webinars, tutorials and forums online.

Limitations

Electronic communication have limitations. Face-to-face communication remains important to build solid relationships with customers and co-workers. Agencies may use email to approach a potential customer, but agency representatives usually travel to meet with customer executives to sell campaign ideas.

It also lacks some of the efficiency demanded in urgent situations. If a decision is needed quickly, face-to-face or phone conversations may work better.

Also, Protecting the privacy and confidentiality of information is another matter for firms that share information electronically. Some firms also abuse or misuse email and other electronic tools for non-work, non-ethical activities. (kukemuller, n.d.)