Manage Quality Customer Service - Assignment

Running Head: CUSTOMER SERVICE QULITY 1
How Amazon Improves Service Quality
Name
Institution

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Contents
Executive Summary.................................................................................................................2
1. Strategies.........................................................................................................................4
2. Services, Parameters, and Operations.............................................................................4
3. Comparative Strategies leading to Improvement of Service Quality..............................6
4. Aspects of service systems..............................................................................................7
5. Statistical methods and management techniques to monitor, control, and improve
service processes of an organisation.......................................................................................8
6. Recommendations.........................................................................................................10
7. Conclusion.....................................................................................................................10
8. References.....................................................................................................................12

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Executive Summary
Amazon is one of the leading global online retailers. The company began in 1996 by
selling books online but has since expanded to sell wide variety of products. Some of the
factors that have contributed to the growth of the company include acquisitions, innovations,
integration of services, ideal supply chain management, steady growth in revenue, and
effective strategies. Amazon’s strategies are entrenched on customer service, efficiency,
distribution, and convenience. The company has various aspects of service systems that
leverage its service quality and sustain competition. The paper also provides overview on
statistical methods and management techniques that Amazon can employ to improve its
service quality.

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How Amazon Improves Service Quality
1. Strategies
Amazon’s mission is “to be Earth’s most customer-centric company where people can
find and discover anything they want to buy online” (Amazon, 2018). From day of its
inception, the company has been committed and focused on this mission. Amazon’s decision-
making and management approach is underpinned on relentless focus on customers. The
company has remain steadfast in delivering current and future customers what it terms as
“compelling value,” which is the driving force behind its quality and satisfactory service
delivery. Amazon’s strategies are entrenched on customer service, efficiency, distribution,
and convenience (Robinson School of Business, 2012).
2. Services, Parameters, and Operations
Committed to align the organizational strategies with customer satisfaction, Amazon
has one of the customer-centric strategy. The multi-billion dollar company has adopted
concepts that ensure it provides exceptional service to customers at different parts of the
world. Improved customer satisfaction is evident on positive feedback that people provides
on Amazon forums. According to Fitzsimmons and Fitzsimmons (2014), service quality
improves customer experiences, which underscores customer loyalty. Customer loyalty refers
to a situation in which a customer purchases a product from the same company or seller
repeatedly because of the positive attitude he/she has towards the seller. According to Bhagat
(2012), service quality is all about the ability of the company to identify and understands
customers’ expectations. In practice, a loyal consumer repurchases the product or service in
order to avoid potential risks. Amazon’s exceptional service quality is evident on the number
of online buyers that return to purchase products. Some of the Amazon initiatives that have

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ostensibly improved customer loyalty include Lending Library, Amazon Prime, and Amazon
Mom (Amazon, 2018). The company has invested substantially in technology in order to
ameliorate customer self-service. According to Robinson School of Business, Amazon has
employed more than 45,000 staff whose main task is to keep updating latest technological
trends. Moreover, Amazon has invested in order software and propriety warehouses, which
ensures that it adequately handles logistics in order to deliver orders in timely fashion
(Amazon, 2018).
Another area that Amazon has focused its strategy is distribution efficiency. Amazon
had initial goal eliminating intermediaries in the in the supply chain management. The
company accomplished the goal by direct contract negotiations with publishers, constructing
large warehouses, hiring Walmart executives to leverage expertise on the operations. Amazon
began establishing massive warehouses as early as 1996, when it rented a “93,000 square foot
warehouse in South Seattle” (Robinson School of Business, 2012). Amazon’s continual
growth in distribution network and formidable supply chain management has sprawled across
the world today. From 2001 to 2003, the company focused its resources on “optimizing both
current and future distribution centres” (Robinson School of Business, 2012). During the
period, Amazon invested massively on implementation of workflow and supply chain
management, which strengthen its distribution systems tremendously. Currently, the company
has established a number of fulfilment centres in North America, Europe, and Asia to
enhance its distribution process (Amazon, 2018). The fulfilment centres are
compartmentalized in accordance to the type of the product to be purchased or shipped.
These centres are designated in Japan, United Stes, Germany, India, China, United Kingdom,
and France. Currently, Amazon is making establish a store in Australia. Parker (2012)
observe that the proliferation of the new technology in retailing sector has significantly
transformed businesses. Internet enhances consumer access to information improves

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convenience for purchasing products. Unlike brick and mortar stores that operate under strict
hours, days, and limited inventory, Amazon customers can purchase products anytime.
Besides, the company takes one to three days to deliver the product.
3. Comparative Strategies leading to Improvement of Service Quality
Moreover, Amazon has adopted a number of strategies on its products and services.
The company is a multi-side platform (MSP) that provides services, products, as well as
technologies that links diverse range of consumers to each other (Robinson School of
Business, 2012). The company developed to MSP gradually, yet effectively. Amazon started
by selling books online but has since diversified into selling wide range of products. The
company started selling music online on 1998, offering services to website developers in
2002, and grocery delivery service (Amazon Fresh) in 2007. Currently, the company is
focusing on online retailing services— Amazon Kindle, Amazon Web Services, and Amazon
Cloud Drive (Amazon, 2018). Amazon also owns other companies— A9, IDMb, and
pets.com. Partly, the company’s growth has been attributed by major acquisitions.
In 1998, Amazon acquired Junglee, PlanetAll, nd Bookpages. Frankel and Forman
(2017) hold that a company may acquire another firm in order to expand market share and
leverage its efficiency. In 2009, the company purchased Zappos, which was a shoe-selling
firm. Amazon also purchased Dipers.com in 2010 and recently acquired Whole Food, one of
the largest grocery store. Furthermore, the company introduced Prime membership
programme. The program is designed to encourage customers to buy more products and
services on Amazon website.
Amazon has also collaborated with drug stores and convenience stores in the online
retailing by employing Amazon Lockers to improve safety of customers during delivery.
Barnes (2008) attests that companies may integrate suppliers to improve its efficiency. The

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program is also helping Amazon to save shipping cost. Another factor that contributes to
Amazon’s growth is focusing its strategy on innovation. The company has expand its Kindle
devices by introducing Kindle Fires to strengthen its capabilities and gain competitive edge in
growing digital technology.
4. Aspects of service systems
Amazon has a unique transaction processing system that provides springboard for the
company to control and meet customer requirement effectively. Amazon website is designed
such that buyers who intend to order a certain good or a service must first create profile.
Thereafter, Amazon offers many features in pursuit of personalizing their profile via wish list
or shopping cart. The two features enable the company to acquire preliminary information
about what the buyer willing to order (Al Imran, 2014). Another important feature of Amazon
system is 1-click purchase. The system facilitates personalized shopping services and
simplifies usage of card transaction. 1-click purchase also enhances communication with
customers through email and direct shipping cross the globe (Amazon, 2018). In essence,
customers that have activated functionality can place their order by just clicking one button
without necessarily filling the order form. One of the main reason why Amazon can easily
use one-click purchase system is the availability of secured server that automatically provides
information needed about the registered customer (Al Imran, 2014).
In addition, Amazon has secure debit/credit card payment systems. To underscore
secure transaction, the company employs “secure server software” that encrypts customer’s
card number and other personal information (Al Imran, 2014). This ensures that the
customer’s important and confidential information is secure over the internet. Similarly,
Amazon has interactive searching system, which enables customers to select desired products
catalogue. The website has fast and accurate searching tools that are convenient to online
buyers because they save time.

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Moreover, Amazon employs oracle as Enterprise Resource Management (ERP)
system to promote service quality (Al Imran, 2014). The company has high-capacity database
that contains information about customers. Amazon website has automated customer-
ordering system that finds nearest distributing store for delivery once the customer has placed
an order. The automated system speeds up “order fulfilment process” by tracking orders and
minimizing distribution mistakes (Al Imran, 2014). The system has enabled the company to
cut down customer service contracts by 50 percent.
Furthermore, Amazon has one of the best customer management system (CMS). In
pursuit of underscoring customer satisfaction and loyalty, the company collects their
customer’s personal information on credit card, order record, transaction record, profile, and
purchase history. Thereafter, the “order processing system” scans transaction record via a
secured transaction technique and then provides instructions to the delivery system for
purposes of shipping (Al Imran, 2014). CRM system also collects information on customer
feedback, product review, and wish list to improve service quality and customer satisfaction.
Besides, Amazon has automated communication system that facilitates interaction with
customers through order information systems, emails, and message system (Al Imran, 2014).
5. Statistical methods and management techniques to monitor, control, and
improve service processes of an organisation.
Statistical methods are some of the effective techniques used by organizations to
control service quality. An approach to improve customer satisfaction is underpinned on the
process alignment, which starts at organization mission statement, evaluating its critical
success factors (CSF), and critical processes. Besides understanding the CFS and business
mission, certain techniques as well as interpersonal skills are required to implement good
communication (Keller, 2012). Barriers to customer satisfaction are quintessentially dynamic,

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which makes it difficult for organizations to execute strategies that meet customer’s
expectations.
According to Lampreia and Major (2017), focusing on management processes helps
to mitigate internal barriers and stimulates the organization to “work as a cross-functional
team with a shared horizontal view of the business.” Therefore, the focus should shift from
management of functions to management of processes. Management processes should
concentrate on areas that require ceaseless improvement, re-engineering, and re-designing.
Essentially, performance measurement pertaining each presses should be conducted to
examine organizational progress so that mission, vision, goals, and CSFs can be re-examined
to address new requirements of for customers and organizations (Lampreia and Major, 2017).
After identifying and defining the core processes, the organization should establish learning
process to enable employees understand the new processes. For learning process to be
effective, the organization must use expertise of quality management team.
To control and improve service quality, the organization needs to first collect
information that about core activities in order to develop a dynamic model. Dynamic model is
a process flowchart or maps (Parker, 2012). Process mapping enables the organization to
understand core envisage important activities that take place in the process (Kenyon and Sen,
2015). Usually, the challenging part is deciding the number of tasks that should be included
in the process. To avoid including too much tasks or many details, it is incumbent to consider
flowing aspects and sources of information about the processes.
The organization needs to define customer-supplier relations in order to analyse how
to improve service quality. In practice, customers are the ones that define quality and
therefore changes to the process should be underpinned on improving both internal and
external customers. Ideally, the focus should be on re-examination of the supply management

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system towards improvement of customer satisfaction (Kenyon and Sen, 2015). The
organization can use flowcharts to identify and document suppliers and customer in each
stage of the process. Another approach to improve and control quality is by defining the
process. This includes using flowcharts to define and document specific areas that the
company should focus on to improve service quality. Prior to defining the process, draft of
the process map should be circulated to gather different suggestions from those who
understand the process. Flow charts can also be used to identify areas that need to be
standardized to control quality (Kenyon and Sen, 2015). To improve service delivery, the
organization needs to design and modify the existing process. After developing the process
map, experts should accentuate areas that require immediate modification or improvement.
6. Recommendations
One of the main challenge that Amazon is facing is shrinking margin. There is
competition from other online retailers like eBay, Alibaba, and Walmart among other host of
competitors. Therefore, the company should establish strategies that that will enhance its
service quality compared to the competitors. One of the best framework to counter
competition is integrating some of critical operational systems (Kenyon and Sen, 2015). May
be its time the company started manufacturing and selling its own products. The company
should also establish its stores in developing countries like Africa and Asia. Currently,
Amazon fulfilment stores are concentrated in Europe and North America. The company may
want to restructure its pricing strategy to gain competitive edge over its rivals. Another gap in
Amazon strategy is its marketing tactics. Amazon should also redesign its advertisement and
publicity strategy to increase its prevalence among the consumers. Unlike other multinational
companies, Amazon has not invested adequately in marketing its brand. Beside Google Ads,
the company should increase advertisements on electronic media and engage in CSR
activities to improve marketing of its brand (Lampreia and Major, 2017).

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7. Conclusion
Amazon’s success is hinged on its strategies that focus on service quality and customer
loyalty. With strong customer management and retention system, the company can collect
data on customer’s personal information, which is significant in developing models to
improve service quality. However, due to rising level of competition in online retailing
sector, the company needs to be more innovative and develop strategies that will further
enhance its performance and gain competitive edge over its rivals.

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8. References
Al Imran, A. (2014). A Study on Amazon: Information Systems, Business Strategies, and e-
CRM. Retrieved from https://www.researchgate.net/publication/261440748
Amazon. (2018). About Amazon. Retrieved from https://www.aboutamazon.com/?
Barnes, D. (2008). Operations Management : An International Perspective. Australia:
Thomson.
Bhagat, P. M. (2012). Effect of Service Quality & Customer Satisfaction on Customer
Loyalty of Cellular Service Providers in Ahmedabad. Paripex - Indian Journal Of
Research, 3(8), 191-194. doi:10.15373/22501991/august2014/59
Fitzsimmons, J. A., & Fitzsimmons, M. J. (2014). Service management: Operations, strategy,
information technology (8th ed.). New York: McGraw-Hill.
Frankel, M. E., & Forman, L. H. (2017). Mergers and Acquisitions basics: The key steps of
acquisitions, divestitures, and investments. Wiley;.
Keller, P. A. (2012). Statistical process control demystified. New York: McGraw-Hill.
Kenyon, G. N., & Sen, K. C. (2015). The perception of quality: Mapping product and service
quality to consumer perceptions. Springer.
Lampreia, J., & Major, M. (2017). A behavioural perspective on the effects of using
performance measurement systems in the companies: Evidence from a case study.
Dos Algarves: A Multidisciplinary e-Journal, 29, 83-101.
doi:10.18089/damej.2017.29.5
Parker, D. (2012). Service Operations Management: The Total Experience. Cheltenham:
Edward Elgar Publishing.
Robinson School of Business. (2012). Amazon.com: Offering Everything from A to Z.
Retrieved from https://robins.richmond.edu/documents/Amazon.pdf

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