Introduction to Amazon

This article provides an introduction to Amazon, a well-known e-commerce business. It discusses the company's history, global operations, customer satisfaction, and competitive advantage. It also explores the factors of globalization and the benefits and challenges faced by Amazon in terms of cost, market, environment, and competition. Additionally, it highlights the strategic complexities in a global environment and the importance of supply chain management.

Contents
Introduction to Amazon...............................................................................................................................2
Analysis........................................................................................................................................................3
Recommended strategies for Amazon......................................................................................................22
Conclusion.................................................................................................................................................24
References-................................................................................................................................................25

Introduction to Amazon
Amazon is a much known E- commerce business that has a very strong brand image because of the
customer relations. It has already set a benchmark in becoming market- leading technological
infrastructure. It provides different type of products that satisfy the needs of the customers. Amazon
has entered into e- commerce trading area in 1995 and started by Jeff Bezos. Amazon has expanded
its operations afterwards in different countries like Europe, Asia and US. Products have been
displayed with amazon “advertising publish under the press release, and many producers display the
products on the website to make money. Amazon always keeps the prices low so that it can be
affordable to everyone. There are many competitive websites that give a strong competition to
Amazon but still due to the loyal customers and brand image, it sustain in highly competitive
advantage. According to Amazon, customer satisfaction is on priority and they always take care
about customer’s concern. It is one of the leading online sellers and sells a big variety of
heterogeneous product line. It is having headquarters in Seattle and has customers in approximately
50 states of USA and 160 different countries. It offers products like books, clothing, hardware,
software, home based products and electronics to its customers through its website and application.
It believes in applying innovation to sustain in the market and to attract the customers. Amazon has a
very customer friendly website and applications by which customer’s avail online shopping in an
easy way.

Analysis
Globalization
Globalization has been prevailed everywhere in each and every part of the world. It refers to a
process in which there is an interaction and integration among the people, culture, organizations and
countries. Globalization impacts different part of the business process and is considered a broad
topic. There are different brands like McDonald’s that possess a very strong brand image. Every
single person knows this brand because it operates in almost every country (Walsh,
Bhagavatheeswaran and Roma, 2019).
The Factors of Globalization
There are many factors that are directly related to the concept of Globalization like market,
environment, cost and competition. Globalization keeps on moving whether in positive or a negative
way. All the factors help in driving the globalization.
1. Cost
Cost is a very important factor that helps in motivating different companies all over the world. It also
helps an organization becoming a global brand. It helps companies to operate in more than one
country and expand its operations by selling product and services on a global basis. Every company
wants to expand its operations and become a global brand and reduce the cost of the company as
much as possible. Low cost production means operating production activities in countries where
there are low tariffs and taxes.
Amazon is a very good example that considered cost factor in globalization. There are many sellers
that are very happy to sell their products on Amazon with good margin even after deducting
Amazon’s share. There is a very minimum cost that is levied in selling the products of different
sellers. Amazon has also controlled cost by charging shipping cost on orders of small amount and
therefore when people place bulk order then only shipping cost is free for them (Huang and
Benyoucef, 2013).
2. Market

There are different countries all over the world and people reside in the same possess different
lifestyle so it becomes really difficult to satisfy different type of needs. Companies always try to sell
the products at a particular location as per the customer’s choices and requirements. If an
organization sells high price products in low income areas then no one will be going to purchase it
and there will be so sales as those costly products are not easily affordable by everyone. So,
companies have to choose whether the products are good for a particular location or not. Amazon is
operating in many countries as it is easily reachable to everyone because of its online presence. It
does not own physical stores and only provides online products to the customers. Amazon has tied up
with many sellers and sells their products online in affordable prices. In order to get a hassle free life,
people nowadays prefer online order websites so that they can easily get the product on their choice
at doorsteps. There is no segmentation because it is already present everywhere (Tourne et al., 2016).
3. Environment
Every large organization comes at a price and the whole world has a watch over them. Every
organization has to follow some rules and regulations and they have to make sure that they will not
provide any kind of harm to the environment. If they do so then it directly harms the reputation of the
company. It will result in the loss of customers because of polluting the environment. Every country
has its own regulations related to the environment and companies are not going to break the laws
because of huge fines implacable on that. Amazon also support pollution- free environment and do
every possible effort to make environment pollution free. Amazon has provided many offers to the
customers like exchange of old phones while purchasing new ones. It helps in protecting the
environment.
4. Competition
Even after a company is doing well in the market and is a world famous organization, it doesn’t mean
they can take it easy. There are many strong competitors in the market and have the capability to take
over the position of top players in a particular industry. For sustaining in the competition, every
organization needs to adopt some development techniques to attract the customers like advertising
and conduct research to know the market demand (Deniz and Atışman, 2017).
Amazon is a very big brand and has capability to face strong competition in the market. It has many
competitors like Flipkart and Snap deal. These organizations are of similar nature like Amazon and
provide online services to the customers (Jukić, 2019).

The Benefits & Challenges for Amazon
1. The Cost Benefits & Challenges
Because of Globalization, Amazon has taken benefits out of the costs. It has spread all its reach to
every country all around the world. It has chosen China for expanding its operation because it is a
developing country and labor cost is cheaper as compared to developed countries like UK, US and
France. Although quality of life is not that much great as salaries and wages are very limited and it
helps in reducing the cost of the company (Tracey, 2015). Amazon has acquired its resources from
all around the world because of low cost. Acquiring resources from developed countries costs higher
in compared to less expensive countries like China. Even after these attractive benefits, Amazon is
facing some more challenges. In order to expand all operations globally, there is a need of investing
high capital into the business because of increasing operating cost. Amazon has started providing
prime membership to customers by which customers can get some extra benefits like free and early
delivery. It helps in acquiring a higher market share and retains loyal customers (Boudreaux, 2008).
2. The Market Benefits & Challenges
Amazon has expanded its operations globally and now they are carrying its operations in
international market. It provides benefit to the organization and able to influence customers to
purchase the products that helps in increasing the profits. An important benefit that Amazon is
enjoying is the brand image (Sinclair and Jayawardena, 2010). By expanding refers to make the
brand familiar to people and it make it more prestigious. It also helps in making the brand image
strong and makes it more recognizable. Market refers to the customers and customer means people
(Goldenberg, 2015). There is different type of social challenge that Amazon has to face while
operating business activities like economy, age, religion, culture and life. Amazon sells different type
of products suitable for different type of population so that it can able to satisfy the needs of the
customers as per their affordability.
3. The Environment Benefits & Challenges
Almost every person thinks that Globalization is not good for the environment but it is not a true
statement. There are different benefits that organizations are enjoying because of Globalization. If an

organization acquires resources from different country then automatically it reduces the resources of
that particular country and provides harm to the environment. So it is better to acquire resources from
different parts of the words so that it can maintain a level of balance (Flanigan, 2016). It helps in
maintaining the environment cleaner and people can get oxygen to live. Globalization is a very wide
concept and by operating in different countries means to maintain the environment healthy and clean.
There are some companies that dump their waste in an illegal way in some areas and it affects the
wildlife and people living there. Countries levy heavy fines to those companies involved in illegal
activities. For maintaining safe environment, Amazon has to take care about the environment and has
to spend an extra amount of capital to recycle the old products and try not to harm the environment
(STEGER and WILSON, 2012).
4. The Competition Benefits & Challenges
Amazon was one of the first players in online business and it has created a very strong brand image
in the market. It has a very loyal group of customers that help the organization in providing
competitive advantage. Globalization also helped the organization by making it familiar with people
all around the world. Amazon has expanded its operation globally but still there are some
organizations like Flipkart and Snap deal that gives a strong competition in the market. Amazon
provides very good services to its customers like easy replacements and return to make customer’s
happy. They also make sure to deliver the product before expected time. Sometimes, they face many
challenges because of competition as there is always a need of development and technological
advancement to retain in market (Mohammad Arabzad an, 2012).
Supply chain is also very important aspect for the organization as it contains various risks like
politics, economic factors and natural disasters. It is important to choose a reliable supplier that can
provide services without any interruptions and save the time and money. Supply chain diversification
helps in minimization of risk as the organization have a diverse suppliers and problems do not impact
the same. It is beneficial to ger the suppliers pre – qualify in advance so that it can help in reducing
the time and money lost because of disruption. There must be proper strategic suppliers for managing
the risk.

Strategic Complexities in terms of risk and diversification in a Global Environment
There are many strategic complexities that every organization has to face in this globalized
environment. There are different challenges that are faced by a global organization (Rao, 2013).
International Trade Law -
Organizations has to obey laws set up in a country if they want to do import and export activities.
There are different countries with different laws and every country wants to operate in a liberal trade
policy. Trade also includes the labor and employment. So, almost every country wants to employ
human resources from developing countries rather than developed countries. Amazon always tries to
acquire resources from different parts of the world for controlling the cost (Lynch, 2018).
Cost Calculation & Global Pricing Strategy -
Every company has to take care about the costs involved in doing the operations. When a company
produces the products and they are unable to sale the same then it create a huge loss for the company
so they have to be careful enough while producing the products. They also need to consider currency
exchange rate while creating pricing strategies (Sox, Higgins and Owens, 2013).
Advances in Technology -
There is a high technological advancement in everyday lives. And people are dependent upon the
technology. Technology helps in facing high competition in the market. Although technology has its
pros and cons like any organization can become a victim of cyber- attack from the hackers and they
can expose the company. Technology helps the organization in attracting more customers and fulfills
their needs (Turner and Johnson, 2010).
Cultural Differences-
Every country has a different culture and choices and preferences vary according to the same. Every
company has to sell the products as per the choices of people as per their location, culture and
beliefs. Amazon has to make sure that it will sell the products as per the affordability of the people.
Supply Chain

Supply Chain refers to a process that helps in managing the supply of an organization. It is a process
in which various links are interconnected that ultimately results in customer satisfaction. Supply
chain starts from collecting the resources and then serving the customers (Pathak, 2017).
1. Sourcing
Manufacturing needs combination of different type of resources and that can be gathered from own
country or some other countries. Importing resources from different parts of the world for
manufacturing is known as Sourcing. Amazon does not need resources as it is not involved in
manufacturing process.
2. Manufacturing
After acquisition of resources, the next stage is manufacturing where all the resources come together
to convert into the final product. Amazon is not involved into manufacturing process
(Balasubramanian, 2009).
3. Warehousing
The next stage is warehousing in which products are placed in safe warehouse for protecting them
from any kind of damage. It also helps in distribution and transportation process. Amazon has
different tie-ups from sellers that directly send goods to the customers and Amazon need not to keep
them in any warehouse (Brown and Labonté, 2011).
4. Distribution
There are different distributors that help in distributing the products to the customers. Amazon has a
very strong distribution channel that assures timely delivery without any destruction. Amazon is the
only organization that allows customers to get the orders without charging delivery fees. To avail this
facility, customers need to buy Amazon Prime membership (Atighechian et al., 2016).
5. Return

Amazon has very flexible services for return and replacement of products. In case of electronic
products it ensures to provide services to the customers till the end of warranty period. It does not
provide for any of the products, it’s all about the policies of the seller (Kang and Jindal, 2018).
There are different strategic challenges related to risk and diversification strategies and the supply
chain flow of Amazon. Amazon was earlier involved in book selling but now it deals in each kind of
product It used conglomerate diversification strategy in the industry. It results in the growth of
products as well as markets that were totally new This diversification was full of risk because people
were not very much open for such huge changes. But Amazon has grown gradually and now
everyone know this big brand name. Amazon has its own warehouses from where it manages its
supply chain. It uses many robotics and automated solutions for packing and picking the orders. It
helps in making the supply chain more efficient. As Amazon has not its own physical existence but it
is available on web so it is really difficult to manage the whole supply chain at every location, but
such automated solutions helped the organization a lot.
The influences of globalization
Globalization results in the process of bringing forces of diverse issue of production trade
information technology. Because of globalization, there is an interaction between different nations. It
has also created impact on Industrial relations and efficiency of operations have been increased. Now
there is a pressure on the organizations to take more initiatives regarding social responsibility and
operate as per ethical principles. It also creates a big influence on leadership it helps in creating
strong business knowledge among leaders and managers and now they understand the cultural
differences in a more efficient way. Organizational structure may also vary when it comes to global
business environment as people are not open to the culture and structure of a single country so there
should be a common way that is acceptable to all. Because of organizational structural change, there
are some changes that leaders needs to adapt. They have converted into open – minded to new ideas,
cultures and thoughts. There is an integration of technology because of Globalization and people start
rethinking the way of managing and conducting the business. People belong to different culture work
in an organization that needs more collaboration and understanding between each other. It also
enables people to understand each other’s culture. Leaders started looking at the functions of the
organizations in a new and deeper way so that they can get the most out of it. Functions of

management must be changed as per the requirement of the organization as well as the people work
in the global business Environment.
The Ethical & Sustainable Factors in Globalization
The Ethical Factors:
 Jobs- There is countries like Japan that has a high suicide rate because of stressful working
hours in the jobs. Japanese always try to work very hard for getting promoted or keeping the
job. So, countries have some policies that limit the number of hours a person work a day in
order to reduce the stress. Amazon is a very ethical organization and it had many suppliers
that overworked and underpaid employees and some of them did suicide. It always keep a
watch on the suppliers for regulating their employees to work maximum 60 hours in a week
and a day off (Sharma and Chowhan, 2015).
 Natural Resources- The world is growing at a higher pace and there are some giant countries
with huge population like India and China. Because of big population, there is a lack of
resources that cannot satisfy the needs. It refer to the less cut down of the forest in order to
safeguard the environment. For example there are countries like Brazil and Indonesia that are
cutting down forests in order to have timber for the population. It results in destruction of
wildlife, habitats as well as oxygen level. Amazon has also started a program that supports
environment. It has many exchange offers for electronics that helps in recycling of old stuff
(SALONER, 2018).
 Transparency- There is a very high competition in the market and every organization wants
to get higher market share. Many companies usually lie to the customers about many things
just to sell their products. So, it is necessary for every organization to be transparent in terms
of the products. Amazon is not directly involved in manufacturing of products but it makes
sure that third party should always reveal every single feature of their products for customers’
benefits. Because of these factors it can make loyal customers stick to the same products
(Inandi, Tunc and Gilic, 2013).

The Sustainable Factors:
 Economy – Big companies never depend on a single market and they need to operate in multiple
markets if in case their local economy gets collapse. It is a very good opportunity to expand the
operations globally rather than to involve in a single market. Amazon is also a huge company and it
has expanded its operations all around the globe and make sure that it earn good revenues.
 Technology – With the help of technological advancement, lives have been improved and
companies as well. Companies try to use latest technologies in order to make operations very
efficient and they use technology in research, marketing and communication. Amazon is into e-
commerce and it’s all about technology. As discussed, there is no physical store and there is only
online reach to purchase products. It helps in creating broad image of Amazon in the market (Lemert,
2016).
 Geopolitics – There are certain restriction on some products that create an issue for the company in
selling the products. So, they have to choose some other option that is called as the second-best
option. There are different countries consist of population that possess different quality of life.
McKinsey’s 7S Model
The McKinsey 7S is the seven interconnected elements that are found in an organization. Hard and
soft elements are the two groups it is divided in that are discussed below:
Hard Elements
These are the elements that are controlled by the management directly and are easily defined and
identified. The elements are strategy, system and structure (Petit, 2012).
Soft Elements
The soft elements are difficult to be defined and identified; as such elements are more governed by
the organization’s culture. These are equally important like hard elements as help in determining the
success of an organization in the industry. Soft elements are skills, staff, and style and shared values.
1. Strategy

A plan made by the organization so as to achieve the long term as well as the short term goals along
with being at the competitive advantage than the others is called strategy. For example, Amazon has
a strategy that focuses on designs as well as the features of the products they manufacture. This gets
them an advantage to continue to produce the same product along with new added features and a
design better than before which lets the customers to buy their products as they know how good the
previous products were and the new one will surely have better design and functionality.
2. Structure
An organization’s structure helps it to organize the divisions of the business along with the reporting
and hierarchy patterns. Most of the structures of the organization are hierarchal and that lets easily
spot who is in charge. CEO was the one who used to handle it all. He gave the rights to the
employees so that they can be a part of the decision making process. No matter more autonomy was
given, the structure of Amazon is still hierarchal (Steger, 2010).
3. System
The daily process of the organization is the system of that company. It helps employees know what
they are expected to do. UAE can be an example on how the system works (Wilkinson and Kannan,
2013).
4. Skills
Skills define the capability of the employees of an organization and how they can handle a situation.
This shows how well the systems can be changed or applying a change to the system. Amazon has
skilled employees and uses “Pull Strategy” that influences the customers because of the brand image
they carry. This infers that the skills of the employees have done so much that it is no longer required
to prove it to the customers of how good their products are.
5. Staff
Each organization has an appropriate person employed for a task who is called staff. The staff needs
to be recruited, motivated, trained and rewarded whenever necessary. The professional staff at
Amazon is professional and at the same time simple for the customers. They have great customer

support and have right attitude towards their clients so that their needs are satiated (Weaven, Baker
and Dant, 2016).
6. Style
Each organization has a management team that interacts having a unique style. The autocratic style
of Amazon follows a traditional style to manage the employees. Uniforms that look professional are
worn at the store that represents their professionalism, style, as well as a rule made by the company
(Westney, 2011).
7. Shared Values
Shared values refer to the standards one follows in an organization. CEO of the company knew that
to make his business successful, thinking different was important. This meant that every subsequent
product they make has to be better than their older version. He had an idea that the company can only
work if they can kill their own product (Weiping Chen, 2011).
Hofstede’s Cultural Dimensions
According to Hofstede (a Dutch social psychologist), five cultural dimensions can be found; power
distance, masculinity-femininity, individualism-collectivism, uncertainty avoidance and time
orientation. An additional cultural dimension, indulgence-restraint, was added much later.
1. Power Distance (High vs. Low)
Power distance helps in measuring the acceptance and expectation of power of the weaker members
which is unequally distributed in an organization. It helps in measuring the inequality. Amazon has a
high-power distance. It gives some autonomy to the employees that help in the decision-making
process. The products are designed without the supervision of the management team.
2. Individualism vs. Collectivism
The relationship between an organization and individuals as loose is individualism. Individuals are
supposed to look after themselves rather than looking after a group of people. On the contrary to this,

Collectivism takes care of the integration between individuals and a team of people. An analysis
shows that Amazon is a Collectivist company because they are a global brand. A huge company is
mostly collectivist as they work together as a whole to get the company to do what it is supposed to
do (Jukić, 2019).
3. Masculinity vs. Femininity
There are gender roles in an organization that the employees adopt not just as an individual, but in an
organization. The two types of gender roles are masculinity and femininity. Masculinity is a
characteristic one finds in men like ego oriented more independence and so on. Women have
feminine characteristics like relationship oriented, dependent on others and so on. Amazon tends to
have masculine traits like they think of an idea and are likely to move forward with the same and
become successful.
4. Uncertainty Avoidance (High vs. Low)
Uncertainty avoidance means to what expect society can tolerate uncertainty. It represents the extent
a culture programs its members to feel uncomfortable or comfortable in situations that are
unstructured. Since Amazon is a huge company, they possess high uncertainty avoidance. Companies
like Amazon are not major risk takers as they cannot risk their image and brand. If the organization
had low uncertainty avoidance, they would suffer the repercussions such as losing brand image or
loyal customers as well as wasting their investments into a failed product (Caust, 2010).
5. Time Orientation (Long Term vs. Short Term)
5th cultural dimension is time orientation and is a cultural difference between East and West. The East
focuses on the long-time run while west focuses on short term run. Amazon is a long term company
and has long term investments.
6. Indulgence vs. Restraint
The Indulgence dimension is a new dimension to the model and is defined as the extent to which
people try to control their impulses, based on the way they were raised. Indulgence is relatively weak

control and Restraint is relatively strong control. Cultures hence can be described as Indulgent or
Restrained. Indulgence means a society that allows free gratification of basic and natural human
drives which is related to enjoying life and having fun. Restraint is a society that suppresses
gratification of needs and hence regulates with the help of strict social norms. Amazon is an
indulgent company it is large. Since it is a big company, they have sufficient resources to invest their
capital into projects that is counted as an indulgent thing to do. For example, Amazon’s indulgence
would be their expansion project, which proves that Amazon is indulgent in spending their resources
on a particular project (Alharthey, 2018).
PESTLE Analysis of Amazon-
PESTLE Analysis is a strategic toll that helps in getting knowledge about the different factors that
create an impact on the organizational goals and objectives. Organizations us PESTLE analysis for
their strategic management. Below is the PESTLE analysis of Amazon.
Political Factors
There are different political factors that create an impact on Amazon like there are various
government policies that create competition as well as promotion by liberalization of telecom and E-
commerce. It also results in increasing affordability and people start using more internets by
introduction of such e- commerce websites (Zahari and Romli, 2018). With the help of political
factors, there is an expansion of markets through mergers and acquisitions. There is a reliable and
fast internet usage for users. There are some laws, rules and regulations that have to be followed by
Amazon to operate in any particular country so it seems a challenge but at the end it gives a good
amount of profit (Tey, 2014).
Economic Factors
Economic factors help Amazon in order to control Inflation and interest values that slow down
consumer spending in UK. There is a downfall in US due to Off Late spending and rise in Asian
market because of economic growth. The main reason is tightening in housing loan as well as credit
crunch. Economic liberalization enables Amazon to open the entrance to global markets like India
and China. Trend of e- retailing has been increasing day by day and it leads in raising the sales. It

also helps in increasing loyal base of customers because of the increase in Globalization (Braddock,
2010).
Social
Social factors include the presence of social media and other channels that lead in social networking.
It helps in adding advantage in marketing of the product and the website. As Amazon is involved into
online business so it brings an advantage to promote the brand by social media. It provides an
interface to the users to shop from online website. But there are some issues with usage on payment
gateways so amazon has to bring a solution in order to reduce risk of the customers (Nyadzayo,
Matanda and Ewing, 2015).
Technological
As there is a high innovation in technology, it helps in accessing internet at cheaper rates. People has
increased usage of technical devices like iPods, mobiles and Led so there is an increase in online
shopping with the help of internet. Internet services are very easily available so it becomes very easy
for people to use such applications. Earlier, it was not that much easier to use internet services freely
because it was very expensive but nowadays people have a liberty to use internet services in a very
low cost and because of this they prefer to do online shopping (Atikah, 2018).
Environmental
Amazon has created awareness about the pollution as well as global warming. With the introduction
of online shopping, people started avoiding travelling and purchase goods online. There is a high
pressure on these big companies regarding corporate social responsibility and go green. They can
easily contribute in the environment safety by using green packaging methods. Because of the
delivery of packages to the customers, it needs solid packaging that leads in wasting paper and
polythene and it harms the environment (Lipsmeyer and Zhu, 2011).
Legal

There are no standard regulations for governing e-retailing in the entire globe like federal trade
commission is in USA and data protection is implacable in UK. Amazon should be aware about both
the domestic as well as international laws. Legal factors have a high impact on the growth of these e-
retailing firms. Amazon should remove traditional methodologies for initiating a transparent and
secure legal environment (Djordjevic, 2013).
SWOT Analysis
Strengths-
Amazon is one of the leading world’s retailer and its strengths comes out of three main factors-
focus, cost leadership and differentiation (Hand, 2016). This strategy helped the company in getting
assistance from the shareholders to get the value from the company. Amazon also derives the
competitive advantage by using e- commerce as an easy platform in order to ensure that company is
able to face the competition. Amazon has a strong customer base that helps in entering into new
market that impact the other e- commerce companies (Sanny et al., 2017), It has an incredible
logistics and distribution system and due to the same it provides better customer satisfaction.
Amazon was one of the startups in online services so it is known by people and people actually trust
the brand. Because of the quality services amazon provides, people do not hesitate to purchase
products from Amazon’s website and application. There is a high customer support in case of any
refund, return or defective product. Amazon has many offers as well that attract more customers and
it provides so ease in shopping without moving anywhere from home (Conklin, 2012).
Weaknesses-
Amazon has its different diversification strategy and its focus is transferring from retailing books
online to other areas. It leads in losing the strategic disadvantages. Amazon also provides free
shipping and it results in moving away from the core competencies. Amazon operated in a business
that has zero margins and impacts the profitability even after selling high volumes and getting huge
revenues (Vargas Leon and Kuehn, 2014).
Opportunities-
As Amazon has its online payment system, it has an opportunity to consider facts that needs to be
considered while online shopping like privacy and security because most of the customers are

concerned about these two factors. It can start its own payment gateway that can improve the margin
of the company. Amazon can start its own brand instead of forwarding side for the third party
products. It helps in increasing the range of the products under its own brand instead of selling
products of the partners. Amazon can expand its business and open different sites in emerging
markets (Ziolkowska and Zubillaga, 2018).
Threats-
Amazon has a biggest threat in online shopping because of prevailing hacking and theft that expose
customer’s data (Lee and Sun, 2017). So Amazon needs to care about the entire consumer’s concern
and ensure that their privacy will be maintained. Amazon has adopted an aggressive pricing strategy
and it has to face different lawsuits from publishers as well. As this organization focuses on cost
leadership and take away all the business from the competitors, they are very upset with Amazon.
There are various online retailers that are very agile and give a very strong competition to the
organization (Denning, 2018).
To enter a new economy refers to high stability and growth. It also results in low inflation, job
opportunities and access to new markets. Organization change is very important for the survival in
the new environment and historical principles are not applicable in Globalization. All the businesses
have already crossed the limit of residing in old model because of its complexities but there are some
difficult challenges in the new economy. These changes are related to the fulfillment of new market’s
demands. There are many types of organizational changes like strategic changes, involve
organizational structural changes, cultural changes and restructuring of tasks. Because of these
changes, expectations of the employees become higher and they expect an improvement in the
knowledge and to become an important part of the organization by facing difficult challenges. So,
organizational behavior changes and there is more advancement regarding knowledge sharing
(Djordjevic, 2013).

Decision Making
It is necessary for every global organization to take risk in order to make decisions. There can be
positive as well as negative results. So it is very difficult for the company to take decision and make
them successful in short- run as well as long run. It is highly beneficial to create long term goals
instead of short term goal (Johnsen, 2015). Wrong decision making may hamper the image of the
company so it is important for the company to make effective decision making strategies so that they
can get the advantages of good decisions. There are different parts in decision making but the main
thing is to identify the problem, creating alternatives, selecting the best solution and then evaluate the
outcome.
 Identifying the Problem
It is important for every organization to find out the problems they usually make while making
the decisions so it is necessary to find right problems as well as their consequences that can
hamper the business of the company. It is the responsibility of every organization to identify the
current state of the business activities and the desired position. If there is not any desired position
then it shows an issue that needs to be resolved (Jinchul Jung and Park, Eun Jin, 2014).
 Generating Good Alternatives

Generating good alternatives refer to more ideas and more ideas means creating solution to the
problems. It is necessary to focus deeply into the problem and having more options and then
choose the most effective.
 Selecting the Best solution
After assessing all the alternatives, the best possible solution has to be selected and it should be
worth it. There should be a solution that can provide long- term benefit instead of short- term
advantages.
 Evaluating the Outcome
After the selection of the best solution, there should be an organizational evaluation of the
selected strategy. It can be done by getting proper feedback from the employees if the feel any
kind of change. If the decision is not effective then organization has to start it all again and if it is
good enough then organization will get benefit from the decision.
Advantages of Decision Making
 Multiple Choices – It is beneficial having multiple choices in order to determine correct solution
of the issue.
 Experience – If any organization face similar problem again and again then they have to select the
best option after considering the past experiences and when the problem accrued last time.
 Success – It is important for every organization to take correct decisions for fulfillment of goals
and objectives else they will fail and there will be no decision making in the organization (Sax and
Andersen, 2018).
Disadvantages of Decision Making
 Time/Money Consuming – Right decisions always results in consumption of more time and
money of the organization.
 Biased Opinions – There are different employees and possess different mindset so it is not
necessary that every decision suit their style of working. It results in mismanagement in the
organization.

 Uncertainty – There are many circumstances when it becomes very difficult to take decisions
because of uncertainty of choice. Nobody knows what will happen in future so organizations have to
take care while taking the right decision for the success of the organization.
Amazon’s Expansion Strategy
1. Prime consider as a hub of the wheel- Amazon Prime was an amazing approach that has
improved the value proposition of the organization in terms of shipping. Jeff Bezos claims
that after the starting of Amazon, it has created 100 million subscribers and creating the
organization, a successful one.
2. Small businesses- Amazon helps small business to enter into the market and can start selling
the products through the website. Amazon always aspires to dominate services like logistics,
warehouse robotics and cashless checkout. With the help of Amazon, it becomes very easy to
start any business and Amazon provides finance to new ventures that gives competition to all
E- commerce websites.
3. Supply chain and home delivery- Amazon has an effective supply- chain that helps in facing
the market competition. Amazon ensures that customers will get timely delivery of their
products in 48 hours. Amazon always tries to make the customer’s happy and ensures that
there will be no issue to the customer’s.
4. Healthcare- Amazon can enter into healthcare and they can start operations into pharmacy
services. It has also joined the forces regarding cardinal health and other distributors that
extend medical reach.
5. Geographic Expansion- As per much research, Amazon can target Europe for its expansion
strategy with international sales target of increasing 40% sales volume.
Routes to Internationalization include key barriers
The Key Barriers in Globalization – Every organization has to come up with the barriers of
globalization while expanding the business. Not every market is the same, so it is important to adapt
and change as per the choices and preferences of local people in international market. Only this
factor can help organization in survival (Lee and Sun, 2017).

Cultural & Social Barriers - Adopting a country’s culture plays a very important role. There are
different countries in the world with different cultures. People have their own values and traditions
and it directly impacts in selling the product in a different country. In such cases, social barrier refers
to the population of foreign market. For resolving this issue, companies try to segregate tis market
into different segments like age, income group, religion, education and sex.
Political Barriers - Political factors are very important while predicting future of company. If a
company is operating in a foreign country and it possess bad relations with the home country then the
foreign country will automatically create unfavorable conditions for the company. In such cases it
becomes difficult to survive the business. There are some other political factors like rules,
regulations, taxes and tariffs that create an impact in the profit pf the company and company has to
follow the same for avoiding penalties.
Tariffs & Trade Restrictions
 Tariffs – A tariff means a tax levied on goods brought into a different country. It is basically levied
in order to discourage foreign trade from entering a digestive market. Import tariffs have two parts-
Revenue tariffs and Protective tariffs.
 Quotas – It refers to the amount of a product that can easily enter or leave a country.
 Embargoes - It refers to the prohibition of commerce and trade with a country and can be of
complete as well as partial nature. It means to limit export or imports, imposing tolls, bans and taxes.
Boycotts –
Every country’s government has a right to boycott any products that are getting imported from a
foreign country. It refers to prohibition of trade and commerce with another country because of bad
political relations with the countries.
Standards –
There are so many Non- Tariff barriers that include many standards in order to protect safety, health
as well as quality of the product. Sometimes, these standards are used in a partial way to restrict the
trade.
Anti-Dumping Penalties-

It refers to the practice in which a producer sells the products in a price less than the cost of the
product to face the competition and sustain in competitive environment.
Monetary Barriers-
 Blocked Currency – Blocked Currency refers to a political weapon that helps in balancing the
payments situation. This blockage lastly results in refusing imports and to exchange the national
currency instead of seller’s currency.
 Differential Exchange Rate – Differential exchange rate enable a country to control imports. It
only shows the importance of the goods that government wants and discourages import of the goods
that government does not want (Lino Rodrigues de Jesus, 2010).
Recommended strategies for Amazon
Technology Integration and R&D
Amazon should increase expenditure in areas of additional telecommunications implementations for
high speed internet and firewall security. These are very significant factors for their good future.
Internet Connectivity is seen as a vital factor to have brand loyalty. Amazon can have competitive
advantage preparing a user friendly interface.
Strategic Cost Analysis
Amazon.com should also use value chain to increase their efficiency to reduce the costs. Each Value
added activity should be identified and non-value added activities should be removed. It Involves
identification of competitors value chains develop strategy that involves low cost.
Inventory
It is important to create user- friendly support in online business so that they can able to maintain a
proper database. Amazon should start using best software’s that can help in maintaining the website
data and back up all systems. It also helps in facing strong market competition.
Keep customers in the loop on everything

It is the responsibility of Amazon to update the status of the order to the customers on timely basis
and to keep them in loop while making any e- mail listing service directly (Holtzman, 2011).
Shipping & Delivery
It is important to take follow ups after delivering the order to customer. Amazon should forward a
mail for asking the feedback about the products within a week of delivering the product (Madra,
2017).
Conclusion
It has been concluded that Globalization is an important factor when it comes to growth of the
organization. There are many companies that became a global brand with the help of Globalization. It
helps in bringing people together in order to achieve the goal. Globalization also results in
exchanging the knowledge, people and culture of the people and the organization to create a
globalized world. Such factors also show that Amazon can also overcome this challenge. There is a
very high competition because of Globalization and forming good strategies and making good
decisions can make any organization successful.

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