Amazon is a cloud computing and e-commerce enterprise, which is situated in Seattle Washington. The founder of Amazon is Jeff Bezos. The company was founded in 1994 inside a garage. Amazon is considered the largest internet retailer based on market capitalization and revenue generation of the world. The company started as an online bookstore in its initial days, and eventually, Jeff Bezos, the CEO expanded the products and services over the years. A customer can purchase anything from books to refrigerators to car parts on Amazon. The Amazon business model has enabled it to become a single-stop store for any range of products and business schemes which include Amazon Web services. The Amazon Web services offer a set of solutions to top companies along with government organisations such as U.S Central Intelligence Agency (CIA). It can be seen that there are more than 1,298,000 employees who are working with Amazon all over the world. The company has generated revenue of around US $386.064 billion as of 2020.
The secret of Amazon’s Success
The former focus of the company was to offer complete convenience to the targeted group of customers. It was for this company, people started enjoying reading their books without physically visiting the store. This innovation 15 years back was a great deal for people to easily search, select and purchase a book online.
The success of the company was not about the products that they were offering but the convenience of buying and selling, which allowed the company to create a strong competitive advantage against many Amazon competitors. This played an important factor for Amazon in building up a loyal and significant customer base and enhancing their profit level in long run. The CEO of the company also provided the feature of adding customer reviews on the Amazon website, which helped the potential buyers to gather necessary information about a product. This helped in the process of fostering a consumer community that helped in making the place more trustworthy and appealing to potential clients.
Amazon Organizational Structure
The organisational structure of Amazon plays an important role in the success and growth of the company. The organisational structure of Amazon mainly focuses on the top-down control of e-commerce operations all across the world. Based on the SWOT analysis Amazon, this Amazon organizational structure is very much effective as the company operates in different business areas such as e-commerce, information technology, and cloud computing. Amazon is a leading online business that aims at maintaining a structure that helps in supporting its diverse products and services along with swiftly escalating market reach.
The organisational structure of Amazon can be termed as functional as it emphasizes on various business tasks and mechanisms as a platform for defining the process of reporting and interacting with customers. The three main components of the organisation structure of Amazon are:
- Global group built on function
- Geographic divisions based on their sub-divisions
- A central global hierarchy.
Geographic divisions based on their sub-divisions
It can be seen that the organisational structure of Amazon integrates different geographical locations for carrying out its business operations. Amazon has specific team groups that are based on their geographical sites and definite business objectives. For instance, Amazon.com applies these divisions as it helps in managing their regulatory network, niceties of different regions, and any issues related to logistics or supply chain.
It can be seen that the advantage behind the process of splitting elements into geographic division helps in accurately addressing the issues that are associated with any particular region. The employees of Amazon are divided into teams who look after the process of solving issues that are faced by customers or in a particular market efficiently. The two geographical locations of Amazon are:
- North America
An overarching global hierarchy
It can be seen that multinational corporation follows hierarchical structures. The concept of using the hierarchical structures was first seen in the big multinational businesses, which are now used by modern businesses that have a global reach similar to Amazon. The hierarchical structure is stated in association to an international system with lines of authority that are influenced heavily by the operations of firms.
For Instance, the top authority of Amazon who exercises the ultimate control is Jeff Bezos. He has the vital power to control all the senior managers and executives who further apply commands and directions on the sectors that fall under their control. The commands or directives provided by the senior executive influence the business operations in all the offices of Amazon all across the world. The presence of overarching hierarchies within Amazon has helped in enabling complete control of the entire organisation even where there are multiple services, product lines, and divisions.
Global Group built on functions
The robust feature of the organizational structure of Amazon is global groups based on different functions such as sales, marketing, and HRM. It can be seen that each business function has been divided into dedicated groups, which are headed by a senior-level manager such as SVP or CEO. This process of structuring has helped the company in managing the e-commerce operations competently and effectively all across the whole organisation. This organisational structure has also helped the company in the process of establishing operations in emerging and new market areas.
The primary global groups of Amazon are as follows:
- Jeff Bezos regulates the office of the CEO.
- CEO Andy Jassy directs the Amazon Web Services
- Finance which is directed by SVP & CFO Brian Olsavsky
- SVP Jeff Blackburn directs the Business and Corporate Development
- CEO Jeff Wilke directs the Worldwide Consumer processes
- SVP David Zapolsky heads the Legal,
- VP Shelley Reynolds is directed by Worldwide Controller (Accounting),
- Jay Carney heads the Corporate Affairs
Effectiveness of Organisational Structure of Amazon
The organisational structure helps Amazon in the process of supporting international growth in the different geographical locations. This structure has helped in successfully growing and expanding its business operations as senior managers look after the issues of different regions. The hierarchical structure of Amazon helps in enabling Amazon.com to implement the directives from the senior executives, managers, and stakeholders effectively and quickly all over its global business operations. According to Forbes, the organisational structure of Amazon helps in the process of satisfying the customers by constantly improving their standards of customer experiences.
It can be concluded by saying that Amazon has preserved its position as an adaptable and flexible market leader despite a rigid hierarchical structure. This structure has helped in facilitating small product teams to have autonomous access to resources of the company along with exerting their unique and experienced leadership.
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