Operational Excellence
Student’s Name
Institution Affiliation
Lecturer’s Name
April 2020
Overview
Amazon Inc. is an American global company with operations around the world. The company is based in Seattle, employing more than 800,000 employees in the United States. The company’s major focus areas are in e-commerce, digital streaming, cloud computing, and Artificial Intelligence. Due to its success, the company is considered as one of the biggest companies in the world and in the industry and has been featured severally in the Fortune 500 list. According to Smith, Rupp & Offodile (2017), Amazon is the largest online market place in the world, selling almost all products in all sectors. The company is also the biggest in providing cloud computing and Artificial Intelligence services in terms of revenues and market capitalization aspects, which make Amazon a key player in the industry. In the United States alone, the company is the second-largest private employer and dubbed one of the world’s most valuable companies.
The company was founded in 1994 by Jeff Bezos as an online market place for books, but in later years it expanded to sell electronics, apparel, video games, furniture, toys, jewelry, and consumables. The success of Amazon culminated in 2015 when it surpassed Walmart as the most valuable retailer in the United States through market capitalization. Over the years, Amazon has acquired several companies like Whole Foods Market, increasing their influence in the brick and mortar model. As of 2018, Amazon Prime, one of its subscription services, had surpassed 100 million subscribers globally, a feat which made the company dominant in the subsector (Amazon Inc., 2020).
The company focuses on distributing downloads and streaming of music, video, and audiobooks through Amazon Music, Prime Video, and Audible subsidiaries across the United States and other locations. Through Amazon Publishing, the company publishes books. The company also operates the Amazon Studios for film and television services and Amazon Web Services which provide cloud computing services. The company also produces consumer electronics like Echo devices, Kindle e-readers, Fire TV, and Fire tablets (Amazon Inc., 2020). The company has also acquired Ring, IMDb, and Twitch, which have increased its influence in the market. The company has achieved considerable success along with Google, Apple, and Microsoft, especially in using innovation to disrupt the industry. Amazon has used several strategies that have seen it become an influential force in the economic and cultural arena.
Resources Used
The founding of the company by Bezos in Seattle was motivated by the presence of Microsoft, which would provide technical talent for the services required. The company has been a front runner in many areas and sectors, which have catapulted its success over the years. The success of the company is largely attributed to the presence of the internet in many countries and the adoption of the online market place culture among shoppers. The company has employed a talented pool of developers, and leaders who have made it possible for them to thrive in the industry (Sehnem et al. ,2019). Over the years, the company has invested enormous funds into their projects, which has enabled them to operate on a global scale.
The company also boasts of an experienced board of directors made up of former business leaders, which has made it possible for the company to make key decisions. Notable business leaders on the board include Indira Nooyi, Judy McGrath, and Wendell Weeks. The company has also adopted the multi-level sales strategy that has enabled the company to focus on consumer relationships and business to business relationships. According to Sehnem et al. (2019), this is one factor that has enabled Amazon to become a force in the industry. Over the years, the company has adopted new strategies and approaches to business, which have also improved their market dominance and the level of their competitiveness. The technology at Amazon is also top-notch and high quality, therefore, making their operations seamless and reliable.
Actions towards Operational Excellence
The biggest break for Amazon Inc came in 2002 when they started the Amazon Web Services, which played a significant role in providing data on the popularity of the website. Through the data collected, the company was able to make the right investments and decisions. The company has also collected important statistics and data for marketers and developers who have turned out to be a great asset for the company. The starting of Fulfilment by Amazon in 2006 enabled Amazon to manage the inventory of small companies that sell their products to the company. The other action that has helped catapult Amazon towards operational excellence was the buying of Kiva Systems that significantly helped automate their inventory and management practices (Smith, Rupp & Offodile, 2017).
The company has been consistent over the years in adopting new policies that promote the welfare of workers, motivation, and productivity, all of which have contributed to operational excellence. Amazon Inc. has a strong supply chain system that has, in a significant way, enabled them to manage their inbound and outbound logistics. The company ensures that customers receive their products at the right time through their network of drop shippers and meta sellers across the world. The biggest asset for Amazon is the data that they have collected over time, which is used to make their operations seamless and successful. Over the years, the company has invested heavily in technology and internet programs, which make it possible for shoppers around the world to access a huge portfolio. Finally, operational excellence for Amazon means improving its systems, processes, and procedures continually, and finding ways to do this requires a visionary leadership (Smith, Rupp & Offodile, 2017).
References
Amazon.com: Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more. (2020). Retrieved 12 April 2020, from https://www.amazon.com/
Sehnem, S., Jabbour, C. J. C., Pereira, S. C. F., & de Sousa Jabbour, A. B. L. (2019). Improving sustainable supply chain performance through operational excellence: circular economy approach. Resources, Conservation and Recycling, 149, 236-248.
Smith, A. D., Rupp, W. T., & Offodile, O. F. (2017). Amazon. Com, Inc.: Retailing Giant to High-Tech Player?.