Please view explanation and answer below.Please find attached the final answer for part 1 and part 2 combined

Answers:

Saudi Electronic University
College of Administrative and Financial Sciences
E-commerce Department

Student Name:

Student ID:

Course Title: Management Information
System

Course Code: MIS201

Academic Year/ Semester: 2020/ 2021Summer term
Instructor Name: Dr. Eman Alyami

CRN: 30187

Student Grade:

Grade Level:

Table of Contents:
1- Table of Contents

P2

2- Executive Summary

P3

3- Organizational Profile

P5

4- Strategies

P7

5- Technology Involved

P9

6- Analysis of Existing System

P11

7- Possible Solutions and Suggestions for the company

P13

8- Conclusion

P15

9- References

P16

2

Executive Summary
Amazon.com Inc. started in 1994 as a digital electronic book reader, but it soon expanded to esales to become the largest online retailer in the world in less than two decades. The e-commerce
and cloud computing company has become, according to Forbes, the world's 4th most valuable
brand. Thus, it is an Internet-based company that sells any and every item online, including but
not limited to books, electronics, clothes, accessories, toys, and many other items. It also
provides other services, like "cloud computing" over the net using its data centers, and the
famous Kindle e-book service that boosted the booking publishing industry in general and the ebook in particular. To better manage its international operation, tremendous size, and employees,
it uses the matrix hierarchical organization.
Amazon should and is a market leader through differentiation. Although the company is very
young, Amazon has rapidly established a brand name recognized, around the whole world as the
name of online shopping no matter what is needed. Amazon leadership in using AI and machines
in its operation and is committed to being a pioneer in that regard; this technology not only
strengthened its brand and differentiation but rather enabled it to achieve the almost impossible
task of establishing both differentiation and cost leadership. With all this success, the only
remaining strategy is to keep to its winning principles and methods and never sacrificing the
flexibility that made it this great
As part of its diversification, Amazon's created “Amazon Web Services” (AWS), a cloud
computing platform. The infrastructure is quite impressive as it has more than 45 data centers in
its global network, with third-party estimates peg its U.S. data center network at about 600
megawatts of IT capacity. It has computed capacity five times than all its competitors combined.
To reach maximum efficiency, Amazon is no longer buying servers but rather building them as
per their design and specification.
Amazon is using many information systems like:

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•

Charging customers online for personalization requests processed by Amazon
Personalize. This is measured by using transactions per second. (TPS)

•

Amazon uses oracle as the Enterprise Resource Management (ERP) with its huge
database. It automates the Customer's ordering process and reduces any distribution
mistakes.

•

It uses a cloud system to distribute information to all levels of its employees and
customers, with instant speed and high efficiency and with redundancy to secure all data.

•

For Business Intelligence, Amazon QuickSight is the best alternative.

•

Amazon has integrated

DSS, Data Science servers, in the cloud that can provide

comprehensive advanced analytics services to many users anywhere concurrently.
In short, Amazon is one of the most successful companies, and few changes in their quality of
services from its suppliers and more attention to the quality of the products are needed to achieve
even higher success. This could be achieved with few programs and applications available within
its resources.

4

Organizational Profile
Amazon.com Inc. was established in 1994 as a digital Kindle electronic book reader in
Washington, which turned Amazon into a major player in the book publishing market
worldwide. And it soon expanded to become the largest online retailer in the world to offer
merchandise in the whole globe in less than two decades. Amazon.com is a vast Internet-based
enterprise that sells clothes, housewares, entertainment (movies, music), gifts, electronics, toys,
and almost anything a customer needs or wants. (Hall 20210) The company diversified and
created AWS providing cloud computing platforms. They provide to other companies web
services that include technical infrastructure and computing tools and applications. AWS is
considered one of the five major digital companies in the world currently. From its inception in
2000 to its creation in 2006, AWS had incredible growth and success in 2019, AWS reported
37% yearly growth and accounted for 12% of Amazon's revenue. Then Finally, in April 2021,
AWS reported 32% yearly growth and accounted for 32% of cloud market share in the Q1 of this
year. (Wikipedia, 2021)

Now Amazon is not only a leader in the digital marketing business and e-book publishing but
also in the cloud web services business that has much growth and potential.
All this success was originated by Amazon’s vision statement is “to be Earth’s most customercentric company, where customers can find and discover anything they might want to buy online,
and endeavors to offer its customers the lowest possible prices.” (Cuofano, 2020)
Establishing a clear vision for the company was essential for their success as they built the
company strategy with loyalty to their vision and purpose. They included customers first in their
culture and expanded as designed to sell any item online with the lowest possible prices. Sticking
to their principles: of widest selection, lowest prices, and most convenience, Amazon. Com was
able to achieve its purpose and goals. To execute their strategy properly and implement it in

5

their culture, they made their mission reflected on these principles, and as a result, the company
values are aligned with their achievements.
Part of the strategy is to establish an organizational hierarchy. It has a hierarchical corporate
structure that is suitable to the vast number of employees working for the company. A senior
management team of three CEOs and three senior vice presidents reporting directly to the
company's general CEO. Even with this system, Amazon did not lose its flexibility as many
others did and remained to adapt to the changes and fluctuations of the markets externally and
internally. Finally, the company's finest feature is the stability in high management that
translated in all of its branches. (Dudovskiy, 2020)

6

Strategies
Using VRIO (Valuable, Rare, hard to imitate, and Organized), the success of a company relies
on having these criteria, and to excel and become a leader the company needs all of them.
Having a valuable product enables the company to operate, but if the product is rare and hard to
imitate then the company starts gaining competitive advantages. Then surrounding the product
with a capable and efficient organization, the company will maintain the competitive advantage
and may become the leader in its field. Competitive advantage could be reached in the broad
market or specialized market called the focus. A company as global and has such a wide
distribution should consider the wide market to reach all segments of society. In the wide sector,
there are two strategies to have a competitive advantage cost or differential leadership. The
competitive advantage could be achieved either by having the best price or obtaining an
advantage no one else possesses. The important factor in this equation is not to get stuck in the
middle trying to achieve both results and win none. In Amazon’s case, although it has enormous
resources and facilities and its costs are reduced, it should not compete for the cost leadership.
Trying to achieve cost leadership could damage their services or innovations. Amazon should
and is a market leader through differentiation. Although the company is very young, Amazon has
rapidly established a brand name recognized around the whole world as the name of online
shopping no matter what is needed. To achieve these results and objectives, Amazon announced
its adherence to four principles: to focus more on the customer than the competitor, passion for
invention and creations, planning strategically, and operational excellence. Amazon's
competitive advantage is founded on these principles. (Company report, 2020) Moving forward
to preserve the competitive advantage and expand it further, the company should rely more on
research and development (R&D) as well as business diversification. Amazon’s leadership in
using AI and machines in its operation and is committed to being a pioneer in that regard; this
technology not only strengthened its brand and differentiation but rather enabled it to achieve the
almost impossible task of establishing both differentiation and cost leadership. This duality is
almost a rarity in business, and achieving such a result can be only attributed to its excellent

7

vision and management leadership. Another strategy success is achieved by diversification where
Amazon used its technical differentiation to open and establish itself in new markets gaining a
large piece of the market in data and cloud management. In investing heavily in AWS (Amazon
Web services), it established itself as a major contender in its field with a high-profit margin.
With all this success, the only remaining strategy is to keep to its winning principles and
methods and never sacrificing the flexibility that made it this great. (Cuofano, 2020)

8

Technology Involved
As part of its diversification, Amazon's created “Amazon Web Services” (AWS), a cloud
computing platform. The infrastructure is quite impressive as it has more than 45 data centers in
its global network; with third-party estimates peg its U.S. data center network at about 600
megawatts of IT capacity. It has computed capacity 5 times all its competitors combined. To
reach maximum efficiency, Amazon is no longer buying servers but rather building them as per
their design and specification. The company worked with Intel To increase the clock rates and
make them run at a much higher rate. (Miller, 2015)
The software used is not typical also. The company utilizes state of the art highly complicated
software on artificial intelligence and machine learning that performs high-performance
transaction systems and complex rendering. Their techniques include data analytics and pattern
recognition among many other processes unknown to competitors. Their neural networks and
probabilistic decision making, perform millions of transactions without human intervention. It
has placed algorithms through machine learning that even not visible on the surface, perform
forecasting demands, rank the products and their searches, place merchandising and even
perform fraud detection and translations. (Chaffey, 2021) For its telecommunications, Amazon
is using 5G technology to advance the technology in the cloud. The company is heavily investing
in the cloud to produce faster and more reliable services in the newest technologies to support
Business support systems (BSS). Using the new cloud technology Amazon has become a leader
in the telecommunication business as well as in the retail world. Certainly, all these innovations
and processes must be protected with a similar information security system to its data and
privacy. AWS provides encryption and threat detection to protect all accounts round the clock. If
any threat is detected, the client is directly informed, and appropriate measures are provided.
AWS provides identity and access management at any scale and any level needed. It is tailororiented and can accommodate any strategy. Similarly, the network is constructed with flexibility
and ease to fit any need. It forces the fine-grained security policy at every network control point
*for extra options and features. (AWS, 2021) Furthermore, to protect against internet security of
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data and fraud Amazon created authentication machines to verify the users. Another system
Smart Analytic Search (SAS), is used to eliminate or minimize fraud.
As for communicating, Amazon uses two levels of systems. WIS (Web-based Information
System) to provide information for the web users and used software like marketplace and
advantages to staying on top by providing a wide selection of items to users.

10

Analysis of Existing System
The world is changing, and the business is changing with it. Although nowadays, resources are
available from anywhere, and companies can sell to anyone no matter where, so can everyone
else. The competition is fierce, and technology is the weapon that is controlling it. With
technology, companies must be market-focused and customer-centric that is essential in ebusiness. Therefore, to cope with competition, Amazon-like others use technology to improve
their knowledge and data, and also to help their workers understanding the customers' wants and
needs. Nevertheless, one key problem with the system is that Amazon is not using the system to
its full power in customer service.
In today's rapidly changing and fast-growing business environment, it is important for every
organization in Ecommerce to effectively improve in its customer-centric business processes.
This will enhance their ability to have a better understanding of their market target and also the
needs and wants of their customer. This can lead to a drop in total satisfaction of the customers
and a loss of some of their loyalty. Therefore, there is a shortage of customer-centric models in
the development and execution plan of its business. (UKESSAYS, 2015)
On the other hand, Amazon is using many information systems like:
•

Charging customers online for personalization requests processed by Amazon
Personalize. This is measured by using transactions per second. (TPS) This is measures
in increments of 5 minutes and are aggregated for the month’s usage and billed according
to this formula
TPS-hours = Maximum of (minimum provisioned TPS, actual TPS) x (5/60 minutes)
(AWS, 2021)

11

•

Amazon uses oracle as the Enterprise Resource Management (ERP) with its huge
database. It automates the Customer's ordering process and reduces any distribution
mistakes.

•

It uses a cloud system to distribute information to all levels of its employees and
customers, with instant speed and high efficiency and with redundancy to secure all data.

•

For Business Intelligence, Amazon QuickSight is the best alternative. It is scalable
serverless, and embeddable with machine learning business intelligence (BI) that is
cloud-based. With its use of dashboards, it can be accessed from any device and
integrated with any application or website. Since it is serverless, it does not need any
infrastructure and can manage tens of thousands of users. QuickSight can answer in
seconds, any business questions in plain English about the data installed.

•

Amazon has integrated DSS, Data Science servers, in the cloud that can provide
comprehensive advanced analyti...