Running Head: Strategic Management and Strategic Competitiveness Strategic Management and Strategic Competitiveness Ibrahim Bio Strayer University BUS 499 Joseph Keller 4/22/19 1 Strategic Management and Strategic Competitiveness 2 Business Management: Amazon Introduction Amazon Inc. is one of the world’s best known and recognizable public companies and brand. It is a household name in many parts of the world, most especially the United States and Canada. It is an online retail conglomerate, dealing in retail, software, cloud services, movie streaming, real estate and robotics among many other businesses. It is however best known for its global retail and delivery business, which is at the core of its identity. This paper will seek to explore the company that is Amazon Inc. Looking at how globalization and technology has impacted it and how it has globalized. Assessing its industrial-organization model and resourcebased model and how they can improve the company’s average returns. It will also look into the vision and mission statements impact on the company’s success as a driving force for meeting company goals, and explore the impact of the various categories of stakeholders on the company’s success making use of various sources in support of the research. Globalization and Technology As an e-commerce giant, Amazon Inc. is heavily reliant on securing and accessing markets for the products it sells and delivers. Additionally, with this reliance on markets comes the need for it to improve and sustain its ability to reach consumers, which is impacted by the ever-growing global market place and technology environment. Globalization has allowed Amazon to access new and previously inaccessible markets and reach a wider berth of consumers than previously available to it. This has led to the global expansion of Amazon Inc. as well as a mass diversification of its business into previously Strategic Management and Strategic Competitiveness 3 unthought of fields, such as audio and video streaming, cloud computing, artificial intelligence, among other services that are in high demand and growth around the world. Globalization has also allowed Amazon to increase the type of products available on its e-commerce retail site as it seeks to serve a varying range of consumer demands and needs (Levy, 2016). This rate of globalization of the company and the world economy as a whole, has led to a phenomenon now termed as the “Amazon Effect”, referring to the disruptive influence and role that Amazon now plays in the retail market impacting individuals lives as well as the overall economy in the United States and the world (Bedel, 2017). Globalization has also allowed Amazon to increase its revenue streams and its overall profitability as a company, by virtue of increasing sales in a wider, more globalized workplace which does not restrict its services and expansion into other countries, but rather facilitates this expansion and growth. Technology has had an overall positive impact on Amazon’s operations. It has allowed for an increase in efficiency, a reduction in costs, allowed for greater diversification of the business into previously inaccessible fields and enhanced innovation in the company. Most of the technology that Amazon has employed has been centered on expanding its business, with some done though acquisitions of other companies to incorporate their technology as part of Amazon. The advent of streaming services in music and videos, lead Amazon to develop its own Amazon Prime streaming service, the advent on e-books led to the development of Kindle by Amazon to allow people access and read e-books at their convenience, the advent of drone technology has led to Amazon using robotics and drones in packaging and delivery, even acquiring a robotics company, Kiva to allow it exclusivity and better access to the technology, the development of cloud computing and services resulted in Amazon also taking interest and engaging in the business with its own cloud computing services that now form a great part of its revenue as well Strategic Management and Strategic Competitiveness 4 as the advent of social media has led to changes in the way Amazon markets itself, its services and its products, allowing it to reach a global audience faster, easier and cheaper (Sherman, 2019). This changes in Amazon’s overall operations and the diversification of its business is evidence of the influence that globalization and technology have had on the company. Industrial Organization Model This model focuses on the external environment as a core impact factor on the strategic well-being of the company. It focuses on the industry in which the firm chooses to operate as having a greater impact on the firm’s performance. For the case of Amazon, this environment or industry is the e-commerce and tech industry, owing to the fact that in is an e-commerce company engaged highly in tech services. Since the Industrial Organization model is based on the assumption that all company’s operating in the industry have access to similar resources, which are highly mobile, with pressures and constraints on the firm which is assumed to be a rational entity, Amazon in its industry will have access to various resources in the form of its numerous suppliers, its customer base (Poudel, 2016). It will face challenges, stemming from government policies and regulations, competitors, supplier relationship, foreign exchange risks and international market operations risks. All of which need to be mitigated against through, investment, acquisitions, marketing, lobbying for favorable policies, insurance and better technological innovation (Amazon.com, Inc., 2018). Such actions to guard against and bolster the strategic and competitive edge of the company will enhance its revenues from the current level. Resource-Based Model Strategic Management and Strategic Competitiveness 5 The resource-based model is focused on the internal structure and environment of the company. It bases its assessment on the assumption that the company possesses inherent resources that grant it strategic advantage over its competitors within its industry, making it better, more competitive and more profitable (Poudel, 2016). For Amazon Inc. its resources lie in the form of its workforce, diversity of its operations, its business model, its fiscal policy and its use of technology and innovation. This is true since Amazon employs a vast amount of technology in its operations, ranging from e-commerce using drones and robots, to streaming, artificial intelligence and cloud computing services. This is also true for its vast work-force that comprises a mix of permanent and temporary workers allowing it a flexible, dynamic and costeffective workforce. Its strategies based on acquisitions of new companies, investment in new technology and skills, acquisition and retention of skilled personnel as well as quality and customer-centered service model, set it apart from the competition and serve as its most potent resource granting it strategic advantage in the e-commerce and tech industry (Amazon Inc., 2019). It is however subject to risks, which it should guard against in ensuring its long-term profitability and stability; risks of data loss, risks as a result of expansion into new fields and product ranges, financial risks relating to company spending and acquisitions, risks in retaining and acquiring skilled personnel, integration and risks in managing global operations of the business (Amazon.com, Inc., 2018). These risks relating to the resource-based model must be addressed through strategic decisions on regulating the type and scope of risks and internal changes the company is exposed to and undertakes as well as deploying better and more costeffective strategies in serving its customers. Vision and Mission Strategic Management and Strategic Competitiveness 6 Amazon’s vision statement is; “to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online.” This statement embodies Amazons customer-centered business model, putting the customer first, as well as evoking its stance as a major and the central player in e-commerce globally and its range of products available to customers. Its mission statement; “We strive to offer our customers the lowest possible prices, the best available selection, and the utmost convenience.” Highlights the company’s wide range of quality products, affordable pricing and convenience. Both the vision and mission statement evoke the identity of Amazon and what it stands for as a company, setting it apart from its competitors as a company as well as setting the principles within which it operates and which are followed by its employees and partners in delivering a successful business (Gregory, 2019). This is particularly true for its customer-centric business model which is spoken of in both its vision and mission statements and which has been the corner-stone of Amazons success. Both the mission and vision do serve as guiding principles, commandments of sorts for the company and its employees and are a crucial motivational and success factor in the company. Stakeholders Amazon Inc. is comprised of various stakeholders, each of whom influence its overall success in various ways. They include; Management and directors; They serve as the core decision makers for the company and they decide on the daily operations of the company, the direction the company will take in future as well as outlining strategic decisions of the company, all of which impact the success of the company. Strategic Management and Strategic Competitiveness 7 Customers; These are perhaps the most important stakeholders of the company. They are what drives the company’s revenues and profitability, as they purchase the company’s products as well as serve as the primary market and drivers for decisions made by the company. They are particularly important for the customer-centric approach employed by Amazon and satisfied and happy customers will contribute positively to the company’s success, by spending more and staying loyal to it. Employees; they are the workforce of the company, who ensure its running. A satisfied, high-performing and efficient employee workforce will mean better performance and productivity for the company, making it more successful. Suppliers and creditors; they provide the finances, raw materials, equipment and products that the company sales and thus play a role in ensuring the company can adequately serve its customers with the products and services they need and contribute to its success. As well as the financial support and leverage necessary for it to operate successfully. Government and authorities: Who play a role in setting regulations and policies on the operations and functions of the company, impacting its success in the areas that the government and authorities exercise power (Ferguson, 2017). Conclusion This paper has assessed Amazon, the impact globalization and technology has had on the company, assessed it in line with the resource-based and industrial organization models, the role its vision and mission play in its success as well as the role of stakeholders in the company’s success. Strategic Management and Strategic Competitiveness 8 References Amazon.com, Inc. (2018, December 31). Amazon.com, Inc. Form 10-K . Retrieved from Securities and Exchange Commission: https://www.sec.gov/Archives/edgar/data/1018724/000101872419000004/amzn20181231x10k.htm Poudel, P. (2016, March 1). The Resource based model or I/O model. Which model is the best to choose your personal strategy? Retrieved from LinkedIn: https://www.linkedin.com/pulse/resource-based-model-io-which-best-choose-yourpersonal-pratik-poudel Bedel, E. (2017, November 6). The Amazon Effect: How Big is The Economic Impact? Retrieved from Inside Indiana Business: http://www.insideindianabusiness.com/story/36769299/the-amazon-effect-how-big-isthe-economic-impact Levy, A. (2016, December 14). Amazon’s global expansion is intensifying. Retrieved from CNBC: https://www.cnbc.com/2016/12/14/amazon-.html Gregory, L. (2019, February 13). Amazon.com Inc.’s Mission Statement & Vision Statement (An Analysis). Retrieved from Panmore: http://panmore.com/amazon-com-inc-visionstatement-mission-statement-analysis Sherman, L. D. (2019, February 14). AMAZON'S EXTRAORDINARY EVOLUTION: A TIMELINE. Retrieved from CNN: https://edition.cnn.com/interactive/2018/10/business/amazon-history-timeline/index.html Strategic Management and Strategic Competitiveness 9 Ferguson, E. (2017, February 20). Amazon.com Inc. Stakeholders, Corporate Social Responsibility (An Analysis). Retrieved from Panmore: http://panmore.com/amazoncom-inc-stakeholders-corporate-social-responsibility-analysis Amazon Inc. (2019, April 22). Amazon. Retrieved from Amazon: https://www.aboutamazon.com/ Running Head: Strategic Management and Strategic Competitiveness Strategic Management and Strategic Competitiveness Ibrahim Bio Strayer University BUS 499 Joseph Keller 4/22/19 1 Strategic Management and Strategic Competitiveness 2 Business Management: Amazon Introduction Amazon Inc. is one of the world’s best known and recognizable public companies and brand. It is a household name in many parts of the world, most especially the United States and Canada. It is an online retail conglomerate, dealing in retail, software, cloud services, movie streaming, real estate and robotics among many other businesses. It is however best known for its global retail and delivery business, which is at the core of its identity. This paper will seek to explore the company that is Amazon Inc. Looking at how globalization and technology has impacted it and how it has globalized. Assessing its industrial-organization model and resourcebased model and how they can improve the company’s average returns. It will also look into the vision and mission statements impact on the company’s success as a driving force for meeting company goals, and explore the impact of the various categories of stakeholders on the company’s success making use of various sources in support of the research. Globalization and Technology As an e-commerce giant, Amazon Inc. is heavily reliant on securing and accessing markets for the products it sells and delivers. Additionally, with this reliance on markets comes the need for it to improve and sustain its ability to reach consumers, which is impacted by the ever-growing global market place and technology environment. Globalization has allowed Amazon to access new and previously inaccessible markets and reach a wider berth of consumers than previously available to it. This has led to the global expansion of Amazon Inc. as well as a mass diversification of its business into previously Strategic Management and Strategic Competitiveness 3 unthought of fields, such as audio and video streaming, cloud computing, artificial intelligence, among other services that are in high demand and growth around the world. Globalization has also allowed Amazon to increase the type of products available on its e-commerce retail site as it seeks to serve a varying range of consumer demands and needs (Levy, 2016). This rate of globalization of the company and the world economy as a whole, has led to a phenomenon now termed as the “Amazon Effect”, referring to the disruptive influence and role that Amazon now plays in the retail market impacting individuals lives as well as the overall economy in the United States and the world (Bedel, 2017). Globalization has also allowed Amazon to increase its revenue streams and its overall profitability as a company, by virtue of increasing sales in a wider, more globalized workplace which does not restrict its services and expansion into other countries, but rather facilitates this expansion and growth. Technology has had an overall positive impact on Amazon’s operations. It has allowed for an increase in efficiency, a reduction in costs, allowed for greater diversification of the business into previously inaccessible fields and enhanced innovation in the company. Most of the technology that Amazon has employed has been centered on expanding its business, with some done though acquisitions of other companies to incorporate their technology as part of Amazon. The advent of streaming services in music and videos, lead Amazon to develop its own Amazon Prime streaming service, the advent on e-books led to the development of Kindle by Amazon to allow people access and read e-books at their convenience, the advent of drone technology has led to Amazon using robotics and drones in packaging and delivery, even acquiring a robotics company, Kiva to allow it exclusivity and better access to the technology, the development of cloud computing and services resulted in Amazon also taking interest and engaging in the business with its own cloud computing services that now form a great part of its revenue as well Strategic Management and Strategic Competitiveness 4 as the advent of social media has led to changes in the way Amazon markets itself, its services and its products, allowing it to reach a global audience faster, easier and cheaper (Sherman, 2019). This changes in Amazon’s overall operations and the diversification of its business is evidence of the influence that globalization and technology have had on the company. Industrial Organization Model This model focuses on the external environment as a core impact factor on the strategic well-being of the company. It focuses on the industry in which the firm chooses to operate as having a greater impact on the firm’s performance. For the case of Amazon, this environment or industry is the e-commerce and tech industry, owing to the fact that in is an e-commerce company engaged highly in tech services. Since the Industrial Organization model is based on the assumption that all company’s operating in the industry have access to similar resources, which are highly mobile, with pressures and constraints on the firm which is assumed to be a rational entity, Amazon in its industry will have access to various resources in the form of its numerous suppliers, its customer base (Poudel, 2016). It will face challenges, stemming from government policies and regulations, competitors, supplier relationship, foreign exchange risks and international market operations risks. All of which need to be mitigated against through, investment, acquisitions, marketing, lobbying for favorable policies, insurance and better technological innovation (Amazon.com, Inc., 2018). Such actions to guard against and bolster the strategic and competitive edge of the company will enhance its revenues from the current level. Resource-Based Model Strategic Management and Strategic Competitiveness 5 The resource-based model is focused on the internal structure and environment of the company. It bases its assessment on the assumption that the company possesses inherent resources that grant it strategic advantage over its competitors within its industry, making it better, more competitive and more profitable (Poudel, 2016). For Amazon Inc. its resources lie in the form of its workforce, diversity of its operations, its business model, its fiscal policy and its use of technology and innovation. This is true since Amazon employs a vast amount of technology in its operations, ranging from e-commerce using drones and robots, to streaming, artificial intelligence and cloud computing services. This is also true for its vast work-force that comprises a mix of permanent and temporary workers allowing it a flexible, dynamic and costeffective workforce. Its strategies based on acquisitions of new companies, investment in new technology and skills, acquisition and retention of skilled personnel as well as quality and customer-centered service model, set it apart from the competition and serve as its most potent resource granting it strategic advantage in the e-commerce and tech industry (Amazon Inc., 2019). It is however subject to risks, which it should guard against in ensuring its long-term profitability and stability; risks of data loss, risks as a result of expansion into new fields and product ranges, financial risks relating to company spending and acquisitions, risks in retaining and acquiring skilled personnel, integration and risks in managing global operations of the business (Amazon.com, Inc., 2018). These risks relating to the resource-based model must be addressed through strategic decisions on regulating the type and scope of risks and internal changes the company is exposed to and undertakes as well as deploying better and more costeffective strategies in serving its customers. Vision and Mission Strategic Management and Strategic Competitiveness 6 Amazon’s vision statement is; “to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online.” This statement embodies Amazons customer-centered business model, putting the customer first, as well as evoking its stance as a major and the central player in e-commerce globally and its range of products available to customers. Its mission statement; “We strive to offer our customers the lowest possible prices, the best available selection, and the utmost convenience.” Highlights the company’s wide range of quality products, affordable pricing and convenience. Both the vision and mission statement evoke the identity of Amazon and what it stands for as a company, setting it apart from its competitors as a company as well as setting the principles within which it operates and which are followed by its employees and partners in delivering a successful business (Gregory, 2019). This is particularly true for its customer-centric business model which is spoken of in both its vision and mission statements and which has been the corner-stone of Amazons success. Both the mission and vision do serve as guiding principles, commandments of sorts for the company and its employees and are a crucial motivational and success factor in the company. Stakeholders Amazon Inc. is comprised of various stakeholders, each of whom influence its overall success in various ways. They include; Management and directors; They serve as the core decision makers for the company and they decide on the daily operations of the company, the direction the company will take in future as well as outlining strategic decisions of the company, all of which impact the success of the company. Strategic Management and Strategic Competitiveness 7 Customers; These are perhaps the most important stakeholders of the company. They are what drives the company’s revenues and profitability, as they purchase the company’s products as well as serve as the primary market and drivers for decisions made by the company. They are particularly important for the customer-centric approach employed by Amazon and satisfied and happy customers will contribute positively to the company’s success, by spending more and staying loyal to it. Employees; they are the workforce of the company, who ensure its running. A satisfied, high-performing and efficient employee workforce will mean better performance and productivity for the company, making it more successful. Suppliers and creditors; they provide the finances, raw materials, equipment and products that the company sales and thus play a role in ensuring the company can adequately serve its customers with the products and services they need and contribute to its success. As well as the financial support and leverage necessary for it to operate successfully. Government and authorities: Who play a role in setting regulations and policies on the operations and functions of the company, impacting its success in the areas that the government and authorities exercise power (Ferguson, 2017). Conclusion This paper has assessed Amazon, the impact globalization and technology has had on the company, assessed it in line with the resource-based and industrial organization models, the role its vision and mission play in its success as well as the role of stakeholders in the company’s success. Strategic Management and Strategic Competitiveness 8 References Amazon.com, Inc. (2018, December 31). Amazon.com, Inc. Form 10-K . Retrieved from Securities and Exchange Commission: https://www.sec.gov/Archives/edgar/data/1018724/000101872419000004/amzn20181231x10k.htm Poudel, P. (2016, March 1). The Resource based model or I/O model. Which model is the best to choose your personal strategy? Retrieved from LinkedIn: https://www.linkedin.com/pulse/resource-based-model-io-which-best-choose-yourpersonal-pratik-poudel Bedel, E. (2017, November 6). The Amazon Effect: How Big is The Economic Impact? Retrieved from Inside Indiana Business: http://www.insideindianabusiness.com/story/36769299/the-amazon-effect-how-big-isthe-economic-impact Levy, A. (2016, December 14). Amazon’s global expansion is intensifying. Retrieved from CNBC: https://www.cnbc.com/2016/12/14/amazon-.html Gregory, L. (2019, February 13). Amazon.com Inc.’s Mission Statement & Vision Statement (An Analysis). Retrieved from Panmore: http://panmore.com/amazon-com-inc-visionstatement-mission-statement-analysis Sherman, L. D. (2019, February 14). AMAZON'S EXTRAORDINARY EVOLUTION: A TIMELINE. Retrieved from CNN: https://edition.cnn.com/interactive/2018/10/business/amazon-history-timeline/index.html Strategic Management and Strategic Competitiveness 9 Ferguson, E. (2017, February 20). Amazon.com Inc. Stakeholders, Corporate Social Responsibility (An Analysis). Retrieved from Panmore: http://panmore.com/amazoncom-inc-stakeholders-corporate-social-responsibility-analysis Amazon Inc. (2019, April 22). Amazon. Retrieved from Amazon: https://www.aboutamazon.com/
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