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Programme MSc Management (PDP)

Module name Leading Through Digital Disruption
Schedule Term First
Student Reference Number(SRN) BP0239269
Report/ Assignment Title Build Strategy and Transformation of Amazon
Date of Submission
(Please attach the confirmation of any 11 Feb 2021 extension received)

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original work, researched, undertaken, completed and submitted in accordance with the
requirements of BPP School of Business and Technology.

The word count, excluding contents table, bibliography and appendices, is 2478 words.

Student Reference Number: BP0239269 Date: 11 Feb 2021

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BPP School of Business and Technology

BUILD STRATEGY AND TRANSFORMATION OF
AMAZON
SRN: B0239269P
DATE: 11 Feb 2021

CONTENTS

Ser . Activity Page no .

1.
Introduction 04

2.
The Case for Change of Amazon 05

3.
Capture Insights 05

4.
Make Fast Decisions 06

5.
Acquire and Engage Talents 07

6.
Create a Digital Reedy Culture 08

7.
Steer Collaboration 08

8.
Select your Leader 09

9.
Conclusion 11

10.
References 12

INTRODUCTION

Digital disruption is an effect that changes the fundamental expectations and behaviors in a
culture, market, industry or process that is caused by, or expressed through, digital capabilities,
channels or assets. Digital disruptions are occurring every day in an increasingly volatile, uncertain,
complex and ambiguous business environment. In order to gain a competitive edge, companies

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need to respond to these disruptive changes and proactively develop their own disruptions for
organizational transformation and growth.

In a fast-changing, competitive marketplace, leaders are often asked to take on highly visible roles
and drive digital disruption. But challenges can arise when the definition of digital isn’t consistent,
and when there’s a nagging sense of doubt about what you should be doing to move forward. To
stay ahead, leaders must understand how disruption impacts them and develop new capabilities
that can drive their own digital transformation. Leaders must have a clear roadmap for developing
their organization’s digital strategy. This requires an understanding of how to evaluate the
marketplace, to identify your competitive strengths, and how to design a unique business
approach that addresses all of your strategic priorities in a coordinated, and technological way.

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THE CASE FOR CHANGE OF AMAZON

Amazon is a company that is in a state of continuous digital transformation. They don’t just create
a highly automated process and stop there. They keep tweaking and improving it to make it faster,
better, and cheaper. Although they are considering applying some cutting edge technologies such
as AI and drones, most of the technology they use is widely available. Their competitive advantage
comes from successfully deploying these technologies through a strong blend of people, process,
and technology, all with a focus on exceeding customer expectations.
Amazon also reaps significant benefits from their digital efforts by accumulating a tremendous
amount of data that they use to learn about customer and supplier trends, introduce new
products, and improve overall service delivery capabilities. These data assets enable management
to make better decisions that result in increased sales and reduced costs.
It is not easy for companies like Amazon to achieve and sustain this level of digital transformation.
They are very process-centric, continually improving their processes and providing a significant
level of training to their employees. They are also willing to take risks, accepting that while some
of their initiatives might not succeed, there will be lessons learned that they can incorporate into
other areas of the business.
As a recent example, given that upcoming automation tools such as drones and robots could
significantly impact a number of existing jobs, management has started a large-scale training
program to retrain these workers for future positions rather than pursuing the normal route of
layoffs and re-hirings. This strategy will result in a stronger corporate culture and a positive impact
on employee morale and loyalty. It will also reduce the risk associated with new hires.

CAPTURE INSIGHTS

A company can follow one or more of three generic strategies: cost leadership, differentiation or
focus. Similarly, Amazon.com has a vision to provide wide variety of products and fulfilment
services along with the affordable prices that requires to achieve economy of scope and
economy of scale along with customer happiness.

Amazon.com’s customer centric strategies, its value creation & proposition starts with its
symbol that represents a smile from A-to-Z for the customers and continues with product
availability and variety along with lower prices to create and deliver value. Amazon’s value chain
drives to provide low prices and extraordinary customer experience which differentiates
Amazon by creating loyalty and unique competitive edge amongst the competitors.
Technology stream has important role to drive and enable Amazon.com’s business strategies. For
example, its ‘efficient in-house computing cloud’ is initially innovated for the purpose of
manage its own business operations as a cloud service. In a short term it has been formed
as AWS tech stack, smartly shifted out and enhanced to serve through a B2B and B2C
customers as a service by optimizing their IT Infrastructure operating costs and by creating
new revenue stream.

As we have seen above the sentences Amazon.com has good sense of technology usage to

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drive its business strategy by making happy its customers and by achieving economy of scope
and scale.
Furthermore, Amazon.com highlights primary competitive factors as selection, price, and
convenience, including fast and reliable fulfilment in the retail industry. Therefore, these
competitive factors match with the key factors that drive customer to shop from Amazon.com
that are highlighted in Figure 5. Evidently, we can say that Amazon.com knows its customers
better than them based on its experience curve and knowledge systems which will be
detailed following sections.
Amazon.com has good sense of technology usage to drive its business strategy by making happy
its customers and by achieving economy of scope and scale. Furthermore, Amazon.com
highlights primary competitive factors as selection, price, and convenience, including fast
and reliable fulfilment in the retail industry. Therefore, these competitive factors match with
the key factors that drive customer to shop from Amazon.com. Evidently, we can say that
Amazon.com knows its customers better than them based on its experience curve and knowledge
systems.

In Figure 4, technology stream

has important role to drive and
enable Amazon.com’s business
strategies. For example,
Amazon.com’s ‘efficient in-
house computing
cloud’ is initially innovated for
the purpose of manage

5
Amazon.com’s own business
operations as a cloud
service (Schreiber, 2016). In a
short term it has been formed
as AWS tech stack, smartly
shifted out and enhanced to
serve through a B2B and B2C
customers as a service by
optimizing their IT
Infrastructure operating costs
and by creating new revenue
stream. Likewise, Fulfilment by
Amazon which mainly uses
robotic fulfilment systems to
reduce idle time and maximise
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the operation efficiency by
cutting operating costs by circa
20% that would translate to
approximately $22Mn in cost
savings for each fulfilment center
regarding Amazon exec Dave-
Clark (Kim,2016). Also, Kindle
Direct Publishing ‘KDP’ which
helps to authors to publish and
sell their books in a minute
(Schreiber, 2016).
MAKE FAST DECISIONS
Amazon’s Jeff Bezos focused on the oldest of old business principles extraordinary customer
obsession to the level that each customer is treated individually and turned it into the ultimate
business purpose of his company. Amazon believes in High-Quality, HighVelocity Decision-Making.
The following five rules can help to get ‘high-velocity decisionmaking’ which Amazon is follows to:
-

1. Recognize there are two types of Decisions .

(a) First type of decisions “are consequential and irreversible or nearly irreversibleone-way
doors, if you walk through and don’t like what you see on the other side, you can’t get back
to where you were before. Such decisions should go through a “heavyweight” process being

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 made slowly and methodically with great deliberations and consultation to ensure a high-
quality decision. This decisions too lightly is a potentially fatal mistake.

(b) Second type of decisions refer to those that “are changeable, reversible they’retwo-
way doors. This decision don’t have to live with the consequences for that long. You can
reopen the door and go back through. This decisions can and should be made quickly by
high-judgment individuals or small groups. According to Jeff Bezos this decisions and
delegate.

These two type decisions beats bureaucracy, analysis paralysis and improves, over time,
people’s judgement in decision-making.

2. Don’t make all Decisions by yourself .

No matter how hard-working you and your top team are, there are only 24 hours in a day. As
your business continues to grow, if decision-making remains concentrated at the top, sooner
or later, you and your top executives will become the biggest impediment to rapid growth.

3. Don’t wait for all the Information .

As stated by Jeff Bezos most decisions should probably be made with somewhere around 70
percent of the information you wish you had. If we wait for 90 percent, in most cases, we
probably being slow. We need to be good at quickly recognizing and correcting bad
decisions. If we good at course-correcting, being wrong may be less costly than you think,
whereas being slow is going to be expensive for sure.”

4. Don’t require approvals that are lengthy and must go through large numbers of Hierarchical
layers.

5. Don’t wait for everyone to agree .

Everyone from executives may not be agreed to someone’s points or decision Amazon is very
clear without and methodology “Disagree and committed”.

ACQUIRE AND ENGAGE TALENTS

Digital transformation can be a daunting task for an organization, but especially when shifts in the
world escalate the need and the timeline. Determining whether there is a mutual fit for both the
company and the candidate is more crucial and complicated than even a few weeks ago. Modern
Hire has been helping companies find their perfect candidates in the digital world for decades.

1. Create a better candidate experience .

Candidate experience is quite the buzzword these days in hiring circles and for a good reason.
Hiring should be viewed as an experience, not a process. Exceptional talent in the marketplace is
going to attract attention from many companies.

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2. Get personal early and often

The reality within many talent acquisition departments these days, which makes getting personal
with candidates more difficult. Text interviewing allows a recruiter to enable a more personal
approach with candidates from the start while creating an effective way to advance the most
promising candidates along quickly.

3. Choose the right technology for video interviewing

Many companies have already made a move to video interviewing, and it’s easy to see why. You
can engage face-to-face with your candidates much earlier in their experience, providing a better
opportunity to create a personal bond and put your brand and company culture on display.

4. Implement fair, effective job assessments

Assessments can be an effective method of gathering standardized data on candidates during the
hiring process. When done right, they provide organizations with a better way of gauging which
candidates are a better fit for the job they are hiring for and a more effective way of predicting
those candidates’ future job performance.

5. Identify the recruiting metrics that matter most

When you invest time and money into any technology solution, there needs to be a way to know if
it’s effective and providing value. Talent acquisition technology solutions are no different, but
what exactly should you be measuring, that generally depends on what your specific
organizational goals are.

Create a Digital reedy culture

There are two types of leaderships exists in organizations: -

(a) Formal Leadership. Formal leadership is where a person is officially designated as the leader
of a group. Examples of this kind of leadership are CEO of a company, a teacher at a school, the
captain of a sporting team and the head of a department. It's the formal leader’s job to organize
the available resources, work out the logistics and motivate the members of the team to carry out
their tasks to the best of their abilities.

(b) Informal Leadership. An informal leader is where a person who's not officially appointed as
the head of a group. However, the other members look to him for motivation and inspiration.
Though the CEO is the formal leader of a company, the employees may look up to a colleague
who, they believe, shares their goals and visions and has some knowledge or experience that will
help them realize their goals. Although these leaders are not in a formal position of leadership,
they are recognized as leaders by their peers.

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Basically the difference in both the leadership is as described below.
Formal leaders have authority and certain rights and privileges that informal leaders lack. Consider
the case of a company where the CEO is the formal leader and an employee is the informal leader.
The formal leader wields power over the group and has the authority to discipline and punish
errant members. Her authority also gives her the ability to give rewards to the group. The informal
leader, on the other hand, does can't formally take action against any members of the group, nor
is he able to reward his teammates. He has to rely on open communication, a shared vision,
guidance and charisma. The informal leader has to lead through example, individual behavior and
personality.

Formal and informal leadership leads Amazon towards more successful day by day, every
employee has the right give suggestion and value, informal leaders are integral part of any
organization similarly they contributes towards by making links of chain.

STEER COLLABORATION
Collaboration tools used by organization are as follow: -
(a) Project management: Quire

Good project management creates a sturdy foundation for increased creativity, improved
brand messaging, enhanced employee confidence and supports operational innovation.
Quire is a collaborative project management software, a simple, straightforward yet
powerful tool that facilitates good project management.

(b) Communication: Slack

From business as usual to special project management, startup teams must communicate to
get work done. When you’re a very small startup just two or three people ad-hoc
communication can work. Still, it’s never too early to be proactive and organize the way your
team handles communications. Slack provides teams with a single location for all their
communication needs

(c) Collaborative funding: CoBudget

Perhaps the most difficult thing to discuss, startup or otherwise, is money. Typically, the
chief financial officer bears the burden of gathering and validating information from multiple
sources.

(d) Content creation: Creativity 365

Every business is in the media business now. Customers want businesses that tell a story.
And even if storytelling is not a high priority for a company, standing out among the
competition certainly is important.

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(e) Crowdsourced decision-making: Loomio

Creativity means nothing without action, and action is fueled by effective decision making.
Collaborative decision-making is about arriving at the best possible solution and those don’t
always come from the boss.

(f) Writing together: Google Docs

Hands down, the best tool for document collaboration is Google Docs. This free app makes it
easy to create and share documents in real-time whether those documents are notes,
spreadsheets or presentations.

(g) Collective Knowledge: ProProfs

Whether your startup is focused on internal improvement or customer care, actionable

knowledge is key. As a centralized platform that gathers, organizes and stores information,
ProProfs knowledge base software makes information accessible to anyone.

SELECT YOUR LEADER

Leadership is the process where someone is able to motivate and inspire others to follow them.
Following is some characteristics of leader in digital transformation: -

1. Leaders are agents of change

Leaders in the digital age must be agile, and more than that they must also be the agents of
change. Leaders today must nurture risk tolerance, take risks and learn from the outcomes. They
must be willing to not only lead and manage change among their teams but within themselves as
well.

2. The customer is the priority

Organizations need to recognize that digital is transforming the entire business process,
establishing a new customer ecosystem and serving as a constant reminder that the customer
must be at the heart of all decision- making processes, particularly around the provision of new
product and services.

3. Leadership is inclusive

It’s time to stop thinking only about the traditional hierarchical leadership structure and start
looking at leadership through a different lens.

4. Leadership is no longer hierarchical

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The leadership landscape has changed. Leadership now is all about collaboration and teamwork.
Organizations need to provide their teams with new capabilities, tools, technologies and mindsets
to drive new behaviors and outcomes.

5. There is a new vernacular

To fully function and operate as a single unified digital force, one where technology and behavior
development co-exist, leadership must develop and model a common vocabulary across the
business.

6. There is shared accountability

Everyone has a role to play in the future-proofing of the organization. Leaders who act to create
an environment where everyone understands and accepts their part in the narrative and those
who share in the accountability by leading from a place of active participation are the ones who
will rise to the top.

Digital is radically overhauling every aspect of business and how organizations operate. It’s a
massive game-changer and determining just how it will disrupt your company is crucial.

CONCLUSION

Amazon is a highly strategic company, and it has been since its inception. It will continue to use its
customer-centric philosophy as a compass in the future. If you’re a Seller who wants to succeed on
Amazon, it behooves you to remember Amazon’s overarching goals. If you can incorporate
Amazon’s strategy into your own, you’ll be able to succeed on the platform as well.

As you can see from Amazon’s example, when a company embarks on a digital
transformation journey, rewards heavily outweigh challenges if the effort is orchestrated in a well-
thought-out and planned manner. Stay tuned for next month, when we will discuss how your
company can get started on such a journey.

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REFERENCES

 Google.com

 entrepreneur.com

 indeed.com

 Courseresearchers.com

 Coursehero.com

 nibusinessinfo.co.uk

 bstrategyhub.com

 Essays 151, by S C Gupta Arihant Publication.

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