SWOT and PESTLE Analysis of Amazon

This report analyzes the SWOT and PESTLE factors influencing Amazon's business and recommends a suitable leadership style for its growth. It also discusses the company's ethics and social responsibilities.

Case Study

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Task 1. SWOT and PESTLE analysis of Amazon......................................................................3
Task 2. Factors that influence Opportunities and Threats...........................................................5
Task 3. Distinct Leadership Style and recent Leadership Style prevailing in Amazon..............5
Task 4. Recommending a suitable leadership style that suits Amazon management style and
supports it to grow in the future...................................................................................................7
Task 5. Commenting on the responsibilities, responses and obligations in the process of ethics
and social responsibilities at Amazon..........................................................................................8
Task 6. Reflection report of the knowledge gained from the research and its benefits in
implementing theories to amazon’s practical framework..........................................................10
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Amazon.com, Inc commonly known as Amazon is a worldwide technology company
headquartered in Seattle, Washington is one of the most valuable brands in world. Company was
established by its CEO Jeff Bezos, in 1994. It started its business by selling books online but
with the time diversified its product range to electronics, software, apparel, furniture and many.
Company now focuses e-commerce, digital streaming (Prime Video), cloud computing and
Artificial Intelligence and is referred as one of the most prominent economic and societal forces
in the world.
This report uses the SWOT and PESTLE frameworks to analyse the changes in the factors and
how Amazon is addressing strength and weakness to negate threats and opportunities. Report
also compare the different leadership style and recommend the suitable management and
leadership style that can match with the Amazon’s style. Further, it discusses the responsibility
and obligations of company towards society and reflects the knowledge gained from the research
by applying theories and framework.
MAIN BODY
Task 1. SWOT and PESTLE analysis of Amazon
Swot analysis is the framework which will help in identifying and evaluating the prime
strengths, weakness, opportunities and threat to amzon.com -
Strengths
Offers diversified and several products at one
stop.
Follows customer-centric approach.
Excellent delivery networks.
First company to come up with cloud
computing.
Weakness
Company avoids taxes and mounting debt.
Faced failure with many products which it
offered.
Reducing strategic advantages in core
expertise.
Not able to deal with Chinese forged products.
Opportunities
Selling its own Brand.
Come-up with its own payment gateway i.e
Amazon pay (Gandolfi and Stone, 2017).
Company has now started investing in mortar
Threat
Threat of Data security and extensibility.
Competition from Rivals and local businesses.
Lawsuits from competitors.

stores and brick.
Entry into pharmacy business.
Capturing developing and emerging market.
Entry barriers are low in e-commerce sector.
Laws of the different countries are not clear
and which is the key threat.
PESTLE framework is used to determine the key factors that influence Amazon’s business
externally –
Political – Amazon being an e-commerce platform company offering catalog of products to
different countries must abide by the political rule and regulations of every country and location.
Company heavily relies on the political stability in the country and expect the support from the
governments.
Economical –Economic Conditions of UK or any other country matters a lot while doing the
business but the economic conditions of UK is better and disposable income of people are high
which allows them to spend more and company benefits itself (Perera, 2017).
Social – Amazon for its contribution towards the society and analysing different factors decided
to expand its grocery market where people gets the grocery deliver at doorsteps in few hours.
And also for more ease and attraction to customers it provide the service of fastest delivery to its
prime membership customers.
Technological – This factor greatly impacts the Amazon as company itself is Technology
Company and relies heavily on technology from placing and receiving orders to deliver them,
every aspect is joined through technology and it keeps on adapting new technology to benefit
itself.
Legal – Every business whether it is offline or online its to abide the laws and regulation set by
the country and e-commerce company has to follow the laws related to cyber and data security,
also company needs to keep track on the laws and policies regarding related to import export
tariffs (Choi, Kim and Kang, 2017).
Environmental – Company through the help of environmental factors have the opportunity to
create its brand image more by contributing in the countries social responsibility by focusing on
business sustainability, contributing n environmental programs and following low carbon
lifestyle.

Task 2. Factors that influence Opportunities and Threats
Political Stability creates the opportunity for the Amazon to expand its operations and
diversify company’s business in developed countries for eg. It can expand its mortar and bricks
business to UK. Other political factor such as support from the government of the country for the
e-commerce business is also opportunity for Amazon as through the help of government support
company can continue its expansion in the related markets. The economic stability in European
countries and the increasing disposable incomes are the opportunities. Increasing DI will boost
the financial performance of the company and economic stability reduces the risk of its e-
commerce business expansion. But the tough competition from China can become the potential
threat for the company. The increasing online shopping habits in people of UK is one of the
greatest opportunity as company has now decided to compete with the local rivals and provides
the fastest delivery of its good than any other country. One of the potential threat, for Amazon is
that increase in no. of cybercrime, this factor has a great influence on the quality of its customers
as well on the Amazon’s business integrity (Simoes, 2020). Amazon can improve its brand
image or develop its brand by contributing its part in environment programs of UK and reducing
the carbon lifestyle from its company this will have a positive impact on the society.
Amazon with the rapid in UK market, company has decided that it will ensure that the customer
trust is maintained by providing the more strong data security to its app users and will keep on
increasing the security of its app users. This is the part of its customer-centric approach which
means its all activities are focused towards customers, as sometimes the loss of data may result
into the lawsuits on the company which not only impacts the company’s image but customer
trust is lost for Amazon. If the company follows the rules, regulations and laws of all the
countries in which its operations are without getting involved in any controversy will open the
door for its expansion more (Gao and et.al., 2017). Company has done experiments with many
products and have faced failure by offering this weakness of the company has proved to become
opportunity for the company as through this process Amazon understood that in this particular
market, this type of product will not work and this is the lesson for its expansion in new markets.
Task 3. Distinct Leadership Style and recent Leadership Style prevailing in Amazon
The following discussed are the different leadership styles -

Democratic – In this leadership style, the team can come up with multiple solutions and is easier
for the leader or manager of Amazon to have various options to decide what solution is best.
Leader gets more respect as the whole team is providing the input for decision-making
(D'Agostino, 2018). This type of leadership cannot keep up with time pressure, because of the
involvement of whole team, it takes time to discuss and analyse situations and listen to
everyone’s opinion.
Laissez - Fiare – Leader practicing this leadership style gives the team independence to work
and take decision by their own. Leader motivates them to focus on the end result and shows
them big picture to look things from different perspectives. If the team has inexperienced
members then meeting the deadline is next to impossible as they can create big trouble and
leader has the responsibility to be them, only if the team has experienced members then the
leader can be sure that they have plenty of knowledge and may meet deadline.
Authoritarian – Leaders practicing this leadership style, follows the authority – responsibility
relationship, which means that he/she keeps order and discipline. This leadership style can be
implemented with both experienced and inexperienced team and when the work is to be
completed under time pressure (Fiaz, Su and Saqib, 2017). To save the time, leader directs and
sends the clear instructions. Decision-making process is fast and any confrontation from any
member is avoided so that there is no chance of time wastage.
Transactional – In this leadership style, the team leader focuses on its team performance and
generally everything is organised. Leaders ensure that the overall goal is clear to all the members
and also provides clear and direct instructions. Leader constantly keeps on motivating with the
rewards and communicates and sets what is the required expectation from them. This leadership
style is not efficient in terms of punishing team members if they do something wrong but have
impact in influencing their behaviour by giving them bonuses and team members take more
initiatives with the provided motivation. Transactional leadership can be implemented in both the
scenarios of experienced team members and of inexperienced team members. In task oriented
leadership style, this one is the most effective.
Transformational Leadership – This leadership style is currently practiced by Amazon, as in
this style leaders inspire and motivate members to perform with their full potential. Leaders and
the teams have good working relationship between them and managers or leaders cares and

support team to give their best. Transactional leader shares his vision with the team and generally
have great impact on smaller teams (Gandolfi and Stone, 2018).
Amazon recently follows the Pragmatist Management style, as the company believes that the
pragmatist leaders sets the high standards and expects unapologetically that those standards set
by them will be met by them and the employees working in Amazon.
Task 4. Recommending a suitable leadership style that suits Amazon management style and
supports it to grow in the future
Current leadership style of Amazon is pragmatist which allows leader to set strong
standards and expect those standards to be fulfilled and meet by employees and themselves
unapologetically (Jarrahi and et.al, 2017).
Strategic leadership is recommended to Amazon which refers to a potential of manager to
express strategic vision for the company, create high profits and grow business efficiently
(Palladan, Abdulkadir and Chong, 2016). Strategic leadership helps in persuading and motivating
the employees to acquire the company’s vision. The main aim of this leadership is to grow
strategic productivity and develop work business environment in which staff members could
forecast the requirements of the company in context of organizations growth and their own job.
Strategic leadership in Amazon will ensure leaders to be proficient at delegation and authorize
team-mates to make decisions (Amayreh, 2020). This leadership will create the appropriate
structure of the Amazon and allocate organizations resources very well according the expressed
strategic vision. To implement strategic leadership, a leader must include characteristics like
being open to modify and left-field thoughts which is precise and will give Amazon a
competitive advantage. Leaders who are effective and powerful demonstrate their loyalty related
to their vision by their actions and words lead to superior the performances. Strategic leadership
in Amazon will support its leaders to keep themselves updated, judiciously utilize their powers to
develop consents for own ideas growing business in the future. This leadership will support in
balancing both short and long term requirements of the Amazon. Strategic leadership will allow
leader of Amazon to be able in connecting with the team mates of the company and have strong
expectations regarding company’s performance. So, these were the facts and benefits that justify
the choice of recommending strategic leadership to Amazon after using appropriate literature.

Task 5. Commenting on the responsibilities, responses and obligations in the process of ethics
and social responsibilities at Amazon
Ethics of Amazon
Ethics and code of business conducts sets out practices and policies regarding
controversial subjects and common principle of guiding. Amazon guides its employees to always
act ethically and lawfully within the best interests of Amazon.com. It has ethics of compliance
with rules, regulations and law. Employees of amazon must have to follow the rules,
regulations and laws all time and if anyone has queries regarding the applicability should contact
the legal department of Amazon. Employees have to avoid conflicts of interest and those who
are interested in this conflict of interest have to promptly notify the legal department which will
look over the considerations of facts and circumstances of the situation. Legal department
decides whether to facts and circumstance are corrective or inappropriate. It has ethics which
includes insider policy of trading. Organization has adopted some guidelines that are designed
to implement this policy and all of its employees are expected to follow and review these
guidelines of Amazon.com. It also includes discrimination and harassment in its ethics and
provides equal opportunities in all the aspects of employment and does not tolerate any type of
illegal harassment or discrimination. It has health and safety ethics and its employees have
responsibilities of maintaining safe and healthy environment in the workplace. The company
does not have influence of illegal alcohol or drugs and it does not permit threatening and violent
behaviour in its business environment. Company has price fixing ethics in which employees of it
cannot discuss prices and cannot make any agreements which are informal or formal with any
rivals of Amazon. Bribery; payments to government personnel is also included in business
ethics of Amazon in which employees cannot bribe anyone and cannot make payments or deal
with government personnel in order to retain business of the organization. Amazon business
ethics includes financial integrity, reporting and recordkeeping in which it record financial
and account statements in an appropriate manner and balance understandable disclosure as
needed by the law. It includes reporting violations in its ethics which its legal department
maintains guidelines of reporting and employees have to cooperate in investigations of alleged
misconduct or internal potential. Ethics like periodic certification are included in business
ethics of Amazon, in this legal department designate some of company’s employees based on

their level of completing responsibilities. Ethics like waivers can be made only when they are
permitted by the law.
Corporate social activities of Amazon (CSR)
It is a concept of management whereby organizations integrate concerns that are social
and environmental in operations of its business (Shetty and Moorthy, 2020). Amazon
implements CSR activities in its business to bolster its image and create its own brand. These
programmes of formal CSR lead to greater the organizations productivity and boost morale of
Amazon’s employees. Amazon implements both ethical practices and corporate social
responsibility in its business because it is vital part to achieve success.
Amazon initiatives and CSR programmes includes:
Amazon has pledged to position its technology and people to hold zero carbon across the entire
organization by 2040. and cloud computing organizations initiated energy consumption and
investing highly in solar and wind to expand 80% renewable energy (Toyama and et.al, 2016). It
helps local communities by creating Amazon relief fund by making an initial contribution of
25USD by keeping its focus on helping its independent partners of delivery services and other
stakeholders to resist the unfavourable impact of pandemic on the business developments. It
initiates programmes of device donation to facilitate donation of gift cards and electronic
devices to the schools which are located near fulfilment centres of Amazon across US.
Organization hosts events ‘Girls who host’ occasionally to support interested girls in acquiring
knowledge of coding. Amazon helps non-profits locally and nationally by donating products and
cash. It empowers and educates workers providing choice of career programs that pays 95%
fees of tuitions, virtual centres of contact allow customer service staff to work from their
homes and offers 5000 USD to warehouse workers in its ‘pay to quit’ program. Amazon
oversees health and safety by recommending its employees to work from home for some time
in this pandemic time. Organization place minorities and gender equality at its core of initiatives
and launched HER project™ to that attracted and influenced 8000 above women’s in its supply
chain.
Comments: Amazon has to maximize workforce in UK by adding more pickers, packers and
engineers to respond rising online demands. It has to provide relevant details of products and
improve order process, product packaging and shipping methods accurately. It has to do

inspection of products regarding damage and defect issues, maintain inventory and organize
stocks properly.
Task 6. Reflection report of the knowledge gained from the research and its benefits in
implementing theories to amazon’s practical framework
This reflection report is basically a critical process of self-reflection after researching and
analysing the previous task based on Amazon (Disseldorp, 2018). After analysing all the factors,
initiatives and strategies of Amazon, some literatures are also reviewed regarding marketing
strategies on its official website. A YouTube video of its founder is also been viewed in which
CEO Jeff Benos narrates very inspiring story of himself which taught several lessons of life like
an individual needs courage, willpower and courage to start a business. This reflection report
analyses economic disputes related to rise in digital commerce. It has been reflected that it does
not waste
its capital on unnecessary and inefficient labour. It is clearly presented that Amazon learning is
not created in its foundations. Amazon operational strategies are highly effective in utilizing its
technologies to optimize consumer solutions and predict their demands. It has been analysed that
firm gone through technological disruptions by the new launches of streaming services. Amazon
has various leadership styles that influences its employees and attract customers to purchase its
brand products electronic paper is the new technology of Amazon that have electrophoretic
displays and earned popularity worldwide for having close resemblance to the books that are
originally printed. It has done developments in bilingual literacy practices that revitalized in
British Columbia. it has implemented long term sustainability practices that support its business
to be durable in the industry. Therefore, it has been reflected that amazon has perfect vision,
innovative framework of business that is E-commerce and strategic management.
CONCLUSION
The above report concludes that Amazon is the giant E-commerce organization and an
acknowledgment of appraisals must be provided to it for their special efforts for extending the
sector of E-commerce to the next level. It is also concluded that Amazon has passed three
winning strategies that helped into broaden its base in the market. It made this possible by
implementing strategies of innovations and making business decisions with full of intelligence.

This report portrays the depth of its crucial success and factors behind its long journey of
success. It is also been concluded that Amazon has developed support and confidence of
customers by using its unique business models that supports company to obtain cutting edge
benefits. Therefore, this report also concludes that Amazon is a pioneer in aligning sellers of
small business into huge customer base using its imperative models. It is also outlined that the
organization makes expansions for enhancing their sales globally.

REFERENCES
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styles on employees' perception of team effectiveness. Social Behavior and Personality:
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Plan for the Future (Doctoral dissertation, University of Oregon).
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Management. 18(9). pp.109-115.
Perera, R., 2017. The PESTLE analysis. Nerdynaut.
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