Innovation Strategy for Amazon using Design Thinking

This paper discusses the innovation strategy of Amazon and its impact on the company. It explores the concept of design thinking and how it has contributed to Amazon's success. The paper also provides recommendations for Amazon to further enhance its innovation capabilities.

Running head: INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
Innovation Strategy for Amazon using Design Thinking
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1INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
Table of Contents
Introduction................................................................................................................................2
Discussion..................................................................................................................................3
Importance of Innovation Strategy.........................................................................................4
Impact of Design Thinking on Amazon.................................................................................5
Amazon’s answer to innovation trend........................................................................................6
Conclusion..................................................................................................................................7
Recommendation........................................................................................................................8
References................................................................................................................................10

2INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
Introduction
The selected organization for this paper is Amazon. The paper illustrates how
Amazon is impacted by the innovation trend. This paper discusses about the innovation
strategy and their relationships. Amazon is a multinational company that is located in Seattle,
Washington. The company was formerly known as Cadabra which was established in July
1994 by the founder Jeff Bezos. The name Amazon was allocated in 1995 (Newcombe et al.,
2015). The name itself suggest exquisite and different which reflected the characteristics of
Amazon River. The company mainly provides E-commerce, artificial intelligence and cloud
computing services. According to (Amazon, 2015), Amazon is the largest American company
that provides a wide platform of E commerce services. Initially it intended to sell books
online but later it became a digital seller of music, apps, movies, clothes, electronics,
cosmetics and many more products. It is the world’s largest provider of cloud services.
Amazon is a wide platform that provides range of varieties of goods and product with an idea
to benefit its consumers. It act as digital media enterprise selling its own electronic products
like kindle tablets, kindle e-book, amazon fire and media adapter. Amazon is an iconic
example of E commerce which has been the largest online retailer over the world. Amazon is
the greatest enterprise that is based on internet which sells movies, music, housewares, books
and electronics. Amazon servers worldwide with its product which includes amazon fresh,
amazon primes, amazon drive, and amazon kindle, amazon music, Alexa (Kantor &
Streitfeld, 2015). It is also considered to be largest shopping app available online which
includes clothes, baby products, jewelries, watches, electronics items, laptops and toys.

3INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
Discussion
In the 21st century, innovation has become a key of success for every organization. It
is important that every company must understand the concept of innovation and how the
enterprise can be completely innovative. It is important to find out the current trend which
will help them to progress towards competitive advantage. There are numerous trends that
will generate a positive impact in the organization (Smith & Linden, 2017). Most of the
organization has already tried to be innovative but fails to have success. In order to under
what innovation is it is required to understand the organisational environment. It must define
what innovation actually do in their environment. The Innovation trend that is selected for
Amazon is Design Thinking. Design thinking is an approach to solve creative problems. It is
a non-linear process which helps the user to understand the challenges pertaining in their
organization and then providing the required solution. Once the organization environment is
understood right, it will be easy to implement the Innovation strategies (Dolata, 2017). One
of the wrong practise that organization does is spending its entire time in planning strategies
but fails to build the culture. The organization must start to implement strategic plans which
includes innovation. The innovation will help in creating ideas that are new and effective.
Innovation strategy is required for both small as well as large business enterprises. The idea
of reshaping the culture will help in fulfilling the customers need and will create ample
opportunities of success for the organization. Moreover, the organization that focuses on long
term strategy instead of short term will be experiencing better growth and benefits. The
process of innovation must be performed by the people from different culture who have come
united to perform innovation (Rodríguez, Paredes & Yi, 2016). The organization must
prepare itself to accept conflicts, difference in opinion. Team work is an important factor to
implement any innovation strategy.

4INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
Value creation can be beneficial to the customer. It improves the quality of services
that is received by the customer and increases the profit gain for the company. Value creation
and capture will help the organization to adapt plans which will help them to sustain
competition. Value capture will help to capture the needs of customer. The values can be
delivered by using these methods. One is by fulfilling all the requirements and another is by
enhancing the quality of the goods and service. It can also be delivered by reducing the
expense of that product. The innovation. Minimizing the cost or providing quality product
will benefit both the consumers as well as suppliers. This will allow the innovator to sell
more products than usual and gain more profit.
Importance of Innovation Strategy
The companies that are implementing innovation strategy have different ideology than
their competitors. It is easy for the company to select a direction, yet only innovative
companies can select something which is different. Only few innovative companies will be
able to cope up with the rapid changes in the environment. Innovation strategy is developed
to grow and profit the market share (Morabito, 2016). Innovation is something that has the
ability to change the entire system of the business. The secret of any leading business
enterprise is the innovation strategy. Offering a good and innovative service will help in
building the trust of the customer. According to reports, it has been founded that applying
strategic innovation within the enterprise will increase the revenue of the company by 90 per
cent (Pisano, 2015). The strategic planning will help to monitor the goal. The strategic
innovation will not only help in developing competitive advantage but will also keep up the
enterprise up to date (Nylén & Holmström, 2015). Hence the importance of strategic planning
can be summarized as follows:

5INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
 Maximizes competition: with the increased competition in the market. They are also
becoming faster and smarter. Hence there can be competitor that can be more
advanced and have more resources than Amazon.
 Strategic innovation will help in satisfying the customer to the fullest.
 Advances the technologies of the organization.
 Change the dynamics of the workplace.
 Maximize globalization.
Impact of Design Thinking on Amazon
Design thinking is the process of designing concepts such as strategic, practical and
cognitive which will help to solve creative problem. The idea that the designers use are
evolved from various field such as engineering and agriculture. The approach helps to
understand the needs of human and those coming up with innovate design to fulfil those
needs. The important feature of design thinking process is identifying the malicious problem
(Kolko, 2015) The impact of this innovation trend in Amazon company will dramatically
increase the success of it. Since amazon is an e commerce website, design plays a vital role
for it. The goof=d and outstanding design will help in good rating of the company. If the
customer will receive their desirable product with greater quality and design it then they will
rate the company five star. The principles that are associated with design will match the
needs of the customers by applying feasible technology (Carlgren, Rauth & Elmquist, 2016).
By adapting design Amazon has reached to a success of $5.6 Billion. Amazon sells 44
percent of its sale online and 56 percent are the members of amazon prime. This innovation
trend has made Amazon successful because it is based in four principle: transparency,
tangibility, trustworthy and helpful. The prime service that amazon introduced eliminated
the shipping cost of the products. It provides tangibility by offering variety of products. The
variation in products, color, design, makes the person choose their desired product quickly

6INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
(Gross & Gross, 2016). By applying filter, people could select from only those library of
product s that they are searching for. The Amazon is capable of selling almost all the product
that customers require in their daily life. It has successfully imagined the mind state of
customer and had offered a varied range of choices for them. Be it be shoes, clothes,
cosmetics or electronics, amazon has offered all kinds. This has made a beautiful experience
for the customers and has made them a consistent investor. According to (Liedtka, 2015),
though maybe Amazon’s website may not be very much visually attractive but the functions
it offers suppresses all of them. Hence to develop a more engaging app, the designers will be
creating a deeper app.
Amazon’s answer to innovation trend
How should the organisation organise its innovation activities?
The innovation activity in any organization requires a good management support, teamwork
and available resources. The Amazon Company can increase the level of education of their
employees. To generate innovative idea, a well-educated employee is require. The
recruitment process must be re organized so as to gain potential employees. The continuous
motivation of employees is necessary to keep them up with the organization. They must be
motivated to deliver innovative idea (Jain, Madan & Singh, 2016). Therefore, a good
incentive structure will help in motivating the employees. The innovation activity involves
external and internal R & , employee training, procurement, software testing and
development.
What additional innovation capabilities should the organisation develop?

7INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
The innovation capability is the ability of an organization to create and innovation culture and
climate. It involves creativity of an individual to develop social and economic ideas. It is an
important aspect of the management of idea and innovation. Innovation will help in creating a
right framework for the Amazon Company to reach the innovation goal. The problem of
shipping cost is faced by amazon. So far it has optimized the problem but yet additional
capabilities is to be required in this field. Due to the shipping cost offered by amazon, the
company is losing its potential customers. It must adapt certain measures to control the cost
of shipping.
What innovation initiatives should it pursue?
The first initiatives for amazon must be eliminating the obstacles of government to
innovation. By limiting the policies of government towards innovation will help the
employees to work easily. This will allow a tangible and flexible approach to enhance the
capability of the employees. The second initiative that amazon must adapt is controlling its
loss in data by cybercriminals. Though none of the companies are safe from the cyber-attacks
but still an attempt can make no harm.
How should the organisation ensure that it creates and captures value from the
innovation?
It is a known fact that a happy customer is the only source of greater revenue. (Zhu & Liu,
2018). Therefore, serving the customers with less shipping cost will help in ensuring the
innovation.

8INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
Conclusion
Therefore, amazon is experiencing incredible rise in the era because of its high quality
product. Its idea to attract customers by proving sales and coupons. Amazon has a bright
future ahead because of the innovation strategy is has been using. More trending strategy will
be developed by it in future. The reason why Google and apple is less than Amazon is the
innovation trend that amazon is using. The focus of amazon to meet its consumer needs and
to reduce the cost of product yet providing quality service has made it a leading E commerce
company in the entire world. It aims to come out of the comfort zone and give its best to the
customer. The marketing strategy of Amazon is not limited. It keeps on increasing the
services it provides. Earlier, it was only a book selling app but now it has expanded itself by
providing prime service which lets the user watch movies and listen to songs just by
subscription. Moreover, amazon is also planning more innovation for the next decade. Thus
the paper concludes by defining the innovation trend that amazon follows and provides a
succinct recommendation for the challenges faced by amazon.
Recommendation
Amazon experience list of challenges in spite of following the innovation trends. Keeping
up its reputation in the E commerce platform, sustaining competitors such as flipkart, myntra
and lenskart, balancing profits and investments and more. In order run any innovation
initiative, alignment with innovation trend is required. To ensure the strategic alignment with
the trend important recommendation must be followed.
 Ask questions: it is important to first confirm what probability is the company is
satisfying its strategic goal. The areas where the strategy is to be implementing must
be identified and the company must be consistent.

9INNOVATION STRATEGY FOR AMAZON USING DESIGN THINKING
 Present the challenges: if Amazon feels that any of its product are unable to satisfy the
customer then it should be immediately eliminate. Any challenges must be identified
that can hamper the reputation of the company.
 Evaluate: If a product is not liked by the customer them it should be examined. The
shortcomings must be taken into consideration and then evaluated.
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