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Contemporary Management Issues; About Amazon

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Contemporary Management Issues; About Amazon



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Contemporary Management Issues; About Amazon

Amazon is a multinational technology corporation based in Seattle, Washington. In 1994, Jeff Bezos incorporated the company, choosing the name Amazon since he associated it with the South American river, and also it started with the initial letter of the alphabet. Based on his market analysis, he realized that providing books on online markets represented a viable investment. Gradually, Bezos expanded the firm from an online marketplace of books to include ornaments, toys, food, furniture, clothing, video games, software, and electronics. Today, the corporation focuses primarily on artificial intelligence (AI), digital streaming, cloud computing, and e-commerce. Through mass scale and technological advancement, Amazon has disrupted well-established industries, attaining a significant global presence; for instance, it owns the leading platforms in cloud computing, live-streaming, AI assistance, and online marketplace. Currently, Amazon is among the Big Four technology conglomerate, along with Facebook, Apple, and Google, having shipped over 5 billion items in 2017 across global markets (Amazon, n.d.).

In 2018, Amazon’s had a 49% e-commerce market share in the United States, controlling over 5% of all retail activities (Tritt & Teschner, 2019). Presently, it maximizes its profit function since at least 95 million people subscribe to its Premium packages, leading to its sales surpassing 12 million products within the United States annually. As shown in Figure 1, concerning revenues, the firm is the largest internet entity internationally, attaining over $280 billion in 2019 (Amazon, n.d.). In the same fiscal year, its market capitalization reached over $920 billion, surpassing enterprises such as Alibaba and Google, making it the most valuable entity on Nasdaq exchange (Al-Marzooqi & Nobanee, 2020). The company pursues a model of reinjecting its revenues into its business activities; hence, according to its annual reports, in 2019, its sales growth rate stood at 21%, amounting to over $87 billion. By February 2020, Amazon had a market capitalization of over $1 trillion and more than 780,000 workers (Streitfeld, 2020).

Figure 1: Amazon's Financials

Source: Amazon (n.d.)

Company Ethical and Social Responsibility Outlook

Amazon operates ethically by providing its work teams with a safe and healthy work environment that is risks and harassment-free, enhancing its employees' liberty to deliver their duties unhindered. For instance, according to Amazon (n.d.), the business strongly discourages behaviors that are not in line with its objectives or that of its suppliers, consumers, or workforce.  However, a report by Ethical Consumer outlines various Amazon ethical issues including, anti-social finance, irresponsible marketing, tax avoidance, environmental pollution, and warehouse abuses (Härkönen, Naskali, & Kimppa, 2019). Despite the continued criticism, Amazon maintains corporate social responsibility (CSR) initiatives that target community interests such as environmental conservation, healthcare, and education. According to the Stakeholder Theory, communities influence buyers’ perception of regarding a firm's operations (Onyusheva & Seenalasataporn, 2018). Through its community support arm, Amazon Smile, the company fulfills its CSR duties. For instance, it...


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