Innovation in E-commerce Business Processes

The assignment discusses the need for innovation in e-commerce businesses to sustain their place in a competitive market. It identifies key factors such as knowledge management, knowledge transfer, and cross-functional cooperation as essential for bringing improvement and innovation in business processes. The study also emphasizes the importance of developing new ideas and improving business practices to maintain and sustain in the competitive market.

MANAGING INNOVATION IN
BUSINESS

EXECUTIVE SUMMARY
The research contains various steps to bring innovation in the business process so that an
organisation can sustain its market position in the competitive world. Innovation refers to an act
which improves or innovates the process. This research study includes various steps followed by
organisations to bring innovation in the business activities which helps the company to develop
and uphold its marketplace and also helps in increasing the market-share. The research includes
different strategies used by organisations to develop a culture which results in benefiting the
overall organisation. Developed ideas and strategies, updated technology, improved
communication between team members lead to innovation in the organisation.

Table of Contents
INTRODUCTION...........................................................................................................................2
TASK...............................................................................................................................................2
1. The Organisation & Its Innovation History............................................................................2
2. The Organisations Existing Innovation Performance And Capabilities.................................3
3. The Industry In 2018...............................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8
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INTRODUCTION
Innovation refers to bringing change in the process or improving the business process in
order to bring effectiveness and improvement in business operational activities which results in
satisfying the needs of customers. The change in processes can be brought by implementing
innovative strategies to create better products or modify the existing offered services. Amazon is
the biggest online retailer merchant in world-wide offering variety of goods and services. The
Amazon company operates its business at many locations and have many individualist websites,
consumer service & fulfilment centres and also have software development centres in
international markets. This report will give details about Amazon company, also the activities
and techniques used to bring innovation.
TASK
1. The Organisation & Its Innovation History
Amazon is the world's largest an e-commerce business in terms of market capitalisation
and income earned. Originally, the Amazon's website i.e. amazon.com was as online book-store
which later modified to sell online videos, audio and MP3. And it further innovated and modified
its business activities and started selling wide range of goods and services including video
games, clothes, jewellery, food products, toys, furniture, etc. and it also has in-house brand
known as AmazonBasics(Trifilova, 2017).
Evaluative approaches are applied to various business data and information about
activities involved in Amazon, its features and its outcomes. This is done to make judgement and
to bring effectiveness and improvement in the activities involved and to make further decisions
related to innovation. The evaluation process helps Amazon company to find out the influences
of actions and steps taken, and it also benefits in further decision-making in an organisation.
The innovation helps in meeting the requirements of customers, attract new customers,
increase market share of the product or services. The innovation can be brought by bringing new
ideas, machinery or tools or by applying new and innovative methods to do the activities.
Amazon aims at bringing innovation in its business activities to meet the changing needs of
customers. Amazon follows continuous evolution strategy which allows the company to
experiment in many sectors or areas and then allow them in building franchises. The
amazon.com website used to sell only books and now it sells everything and it made amazon the
leader of global market(Smith and Tushman, 2015). The first product sold by amazon was a
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book in 1995 and later in 1998 it expanded by selling convenience services to the customers.
Amazon further developed its business in 2005 and expanded by moving into cloud computing
market area, which allowed customers to store the digital files and they can have access over it
anytime using the web browser. In 2007, Amazon started selling groceries and it offers
perishable and non perishable food products in AmazonFresh. It further introduced Amazon
Kindle allowing people to buy books as e-books or online books by 2010, and this resulted in
people buying more e-books than the physical books of amazon. In 2015, it started offering
Amazon Music and Video and increased its market share and capitalisation.
The amazon company has achieved growth and innovation in business due to its
technological innovation. The amazon focuses on making the experience of online shopping the
easiest one or as smooth as achievable(Schmidt, 2014). The online shopping process has been
continuously adding and refining the techniques to enhance and improve the experience of online
shopping. And by using continuous development strategies, amazon has managed to reach the
success and still find ways to develop and expand to meet customer's expectations.
2. The Organisations Existing Innovation Performance And Capabilities
The innovation process start with new ideas, innovative plans and appropriate strategies.
This guides an organisation the purpose of innovation and about the further development
activities which will be taken. The planning process identifies the problem and objectives of the
innovation process. By properly applying the innovative methodologies and strategies, Amazon
has expanded its business and now it offers wide range of product categories including 100
million items.
The expanded business of Amazon has millions of customers having different needs and
Amazon functions to meet those needs by applying innovative plans and strategies, technological
researches and ultimately it makes the activities better and cost-effective. The organisation
focuses on providing the best services to customers and ensuring their full satisfaction and their
online shopping experience(Parkes and Wellman, 2015). The company utilizes the best use of
technology and human resources available to deliver the products and services to customers and
meet their needs and wants.
The amazon organisation has introduced innovations in various business models in
hardware and new service sectors. Amazon prime is one of the innovation adopted by amazon
which allows customers a one-year membership program which includes unlimited free shipping
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of products and also involves accession to streaming of TV episodes and films. The Amazon
company has its own shoe line business named as The Fix, it also has clothing brands named as
Ella Moon, Paris Sunday and Good Threads and have many consumer goods which are
categorised under AmazonBasics.
Importance of Organisational knowledge: In order to expand the business, the management
should have the knowledge about the organisation(Morais-da-Silva and et.al., 2016). The
organisational knowledge helps in managing the company's success and there are three key
reasons which facilitate decision-making capabilities in the organisation, it helps in building
learning routine in the organisation and it helps to stimulate change in culture and bring
innovation.
1. Facilitates capabilities in decision-making:
The knowledge about the organisation can offer lots of information to management which can
leads to making high-quality decisions. The amazon uses corporate executive council which
helps executives in sharing the relevant and accurate information and improve the quality of
decision-making.
2. Builds learning structure by learning routines:
After having the complete knowledge about the organisation, the management focuses on to
build learning routines which creates a culture where employees assess themselves and about the
overall organisation and find ways to bring improvement.
3. Brings culture change and innovation:
The amazon actively manages the organisational knowledge which results in thought-provoking
change in culture of the structure of organisation and it also encourages employees so that free
flow of ideas can happen and finally leads to innovation.
Importance of Knowledge Transfer: The development of new knowledge and proper transfer
of it among employees results in creativity, devolution of new ideas and plans which benefits the
organisation in economic growth through innovation and improvement of the company. It helps
the Amazon organisation in solving problems and also in expanding its business in different
market areas through new and developed ideas(Li and et.al., 2016). The effective knowledge
transfer in an organisation may happen by following various steps:
1. Encourage collaboration:
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The Amazon aims at encouraging collaboration among employees, which help in building the
co-operative environment and every employee takes responsibility and result in positive
outcomes(Amazon Innovates With Its Business Model, Not Drones, 2018). And employees work
as a team and brings success to the organisation by co-operative efforts.
2. Encourage experience employees to guide other employees:
Every business needs experienced employees to achieve the targeted goals of the company.
Amazon focuses on building a culture where experience employees share their experiences and
make their work visible to other employees to make them learn about different opportunities and
threats of the business environment(Drucker, 2014).
3. Create culture of openness and trust among employees:
Amazon aims at making culture of openness where employees share their knowledge willingly
so that it assists the other employees as well and trust is created among them for each other and
ultimately the organisation gets benefit.
These steps can lead to employees co-operation, open culture and sharing of knowledge
among employees brings smoothness in the business process which helps in the innovation and
development of the organisation.
Importance of Cross Functional Cooperation: The cross functional cooperation means
different functional areas of an organisation work in team and a cooperates so that organisational
objectives are achieved. The cross functional team have members from different levels of
organisation and also from different functional departments having different skills and
knowledge(Biemans, 2018). The cross functional co-operation of employees leads to
improvements in the organisation through the following:
1. Increase Teamwork:
The amazon organisation aims at building the teamwork culture in the organisation so that it can
lead to sharing of ideas and knowledge of individual employees. The different levels of
employees working together in a team can solve problems and find solutions for the same.
2. Improves Communication:
The collaboration of different functional team members can lead in minimizing the gap between
diverse group of people and improves the communication which leads to sharing of knowledge
and ultimately generating new ideas for innovation and improvement.
3. Continuous Improvement:
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The amazon focuses on creating a cultural environment in which every employees understand
their duties and responsibilities and work together in a team to achieve organisational
objectives(Archibald and Archibald, 2016). The collaboration of functional co-operation brings
continuous improvement in the activities of the organisation and leads to innovation and
development.
3. The Industry In 2018
Increased market-share- The e-commerce industry is growing day to day by providing
satisfaction to customers in the best possible way. The e-commerce has the great market share
and it is expected to increase in future as well because of the changing trends. This is the great
opportunity for e-commerce industry to expand its business by bringing innovation in the
business practices. The organisations can also expand its business in retail markets and offer
offline services or products to customers.
Augmented and virtual reality- Augmented reality provide an individual to visualise the real
life experience of product before making purchase decision. It will reduce confusion and time
waste in making purchasing decision(Ambrose, Matthews and Rutherford, 2018). Also,
minimises the cost bear by company in taking back the retuned product. E commerce get to
know how consumer choose product companies can offer customised product demanded by
consumer.
Multichannel shopping- e commerce company can improve their sale by provide various
platform to purchase the product according to particular segment. Retail store can be open in
villages ad small town so that people who have money but don't know online shopping can also
purchase, advertise product on social media like Instagram, Pinterest and Facebook.
Block chain and cryptocurrency- block chains are used to store data which can not be edited
after creation, it creates trust between parties. E commerce use block chains for tacking order
fulfilment. For example when order dispatch from factory it creates a block, when shipping
process completed, one more block add. It offers transparency. Block chain transactions insure
secure, speedy payment. Block chain based cryptocurrency provide a globally accepted
alternative currency options. E commerce companies must use these new technology as they are
now in trend.
Developing multi-channel E-commerce- The e-commerce industry should focus on
maintaining multichannel retailing in order to survive and develop as well. There is need for
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maintaining the infra-structured store for surviving and sustaining in the competitive market
because of retail business as the competitors.
Artificial Intelligence and Internet Of Things(IOT)- e-commerce company can use artificial
intelligence for data gathering, analysing, customisation of product and service, buying
behaviour and target audience, generation automatic personalised email by watching past buying,
managing inventory, promote same product searched by customer etc.
CONCLUSION
There is need for innovation in every business to sustain its place in the competitive
market. The above research determines the factors which are essential to bring improvement and
innovation in the business process. The study also states that the innovation can be achieved by
proper knowledge management, knowledge transfer and cross functional co-operation. It is very
important to continuously develop new ideas and improve business practices in order to maintain
and sustain in the competitive market. The strategies adopted by management brings innovation
in the business processes and allows a company to sustain in the market.
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REFERENCES
Books and journals
Ambrose, S.C., Matthews, L.M. and Rutherford, B.N., 2018. Cross-functional teams and social
identity theory: A study of sales and operations planning (S&OP). Journal of Business
Research. 92 pp.270-278.
Archibald, R.D. and Archibald, S., 2016. Leading and Managing Innovation: What Every
Executive Team Must Know about Project, Program, and Portfolio Management.
Auerbach Publications.
Biemans, W., 2018. Managing innovation within networks. Routledge.
Drucker, P., 2014. Innovation and entrepreneurship. Routledge.
Li, C.R., and et.al., 2016. Top management team diversity, ambidextrous innovation and the
mediating effect of top team decision-making processes. Industry and Innovation.23(3).
pp.260-275.
Morais-da-Silva, R.L., and et.al., 2016. Innovation for Sustainability: Creating Mutual Values.
In ISPIM Conference Proceedings (p. 1). The International Society for Professional
Innovation Management (ISPIM).
Parkes, D.C. and Wellman, M.P., 2015. Economic reasoning and artificial
intelligence. Science.349(6245). pp.267-272.
Schmidt, M., 2014. Amazon's Going the'Last Mile'. Quality Progress. 47(6). p.10.
Smith, W.K. and Tushman, M.L., 2015. Managing strategic contradictions: A top management
model for managing innovation streams. Organization science. 16(5). pp.522-536.
Trifilova, A., 2017. complex innovative environment managing innovation managing change
open innovation open business model. In The Future of Innovation (pp. 186-187).
Routledge.
Online
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Amazon Innovates With Its Business Model, Not Drones. 2018. [ONLINE]. Available
through:<https://www.wired.com/insights/2014/01/amazon-innovates-business-model-
drones/>
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