Strategic Direction - Analysis of Amazon's Organisational Strategy

This report discusses the strategic direction of Amazon, including their aims and objectives, critical assessment of their current strategy, progress towards achieving their objectives, and evaluation of their strategic position. It also covers stakeholder expectations and impact on future organisational scheme.

Strategic direction.

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
The strategic aims and objectives of the organisation.....................................................................3
Critical assessment of the element of current organizational strategy........................................4
Analyse the element impacting the strategic aims of organisational scheme over the short and
medium term...............................................................................................................................5
TASK 2 ...........................................................................................................................................6
Progress in achieving organisational objectives..............................................................................6
Different types of diagnostic and analytical tools to audit and assess improvement towards
existing strategic objectives and aims.........................................................................................6
evaluate the expectations of all stakeholders and their impact upon future organizational
scheme.........................................................................................................................................7
interpret and make an evaluation of the existing organisational strategic position and
improvement towards achieving the existing strategy................................................................8
TASK 3............................................................................................................................................9
evaluate strategic options to support a new strategic position.........................................................9
develop a range of choose strategic options to meet organisational strategic aims, way and
objectives in the short and medium term....................................................................................9
Determine the active strategic option that can meet the altered strategic position.....................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Strategic direction refers to an implementation of a plan or a strategy made in the
organisation which can help the company in fulfilling their goals and objectives. It is an
important activity in the business organisation which helps the employees as well as
management of the company to ensure that they are going in the right direction and are
communicating effectively about the contribution of the employees and the hard work of
employees which helped the company in fulfilling their business objectives (Hulinchuk., 2018) .
In context to Amazon, it is an American British Multinational technology company. The
company was founded by Jeff Bezos in the year 1994 and is currently headquartered in
Washington U.S. In this report, the strategic aims and objectives of the company will be
discussed. Along with that the components of current organisational strategy will be provided.
The report also covers an evaluation of the progress towards the achievement of organisational
aims and objectives. Along with that strategic option's evaluation which can support the new
strategic position of the company is provided.
TASK 1
The strategic aims and objectives of the organisation.
determine of existing objectives and aims of the organisation.
The aim of the company is to become world's most customer centric company . The
mission of the company is to provide best in class services to its customers and to make sure that
they are improving their customers services each new day. They are having high standards and
want to make sure that with the help of internet and technology they will be able to help
customers in discovering, finding and buying anything they want online. With the help of digital
empowerment the company wants to help customers to improve their standard of living and drive
economic competitiveness and productivity in a global economy.
The objective of the company is to provide the best and wholesome experience to their
customers. They want to capture every market segment of the industry and want to make sure
that the customers of the company are getting experience like never before(Lavrov., 2018) . The
company is one of the best retailers in the world and has built a platform which can provide
almost all services to their customers. The company says that ”Our customers are loyal to us
right up until the second somebody offers them a better service. It’s super motivating for us.”

presently the organisation is the largest online retailers in the world. The objective of the
company is to change according to the dynamic markets of the industry and to make sure that
they are running according to the trends of the marketplace and are also the company wants to
make sure that they are fulfilling all their commitment towards their customers so that they will
be able to maintain their loyal customer base and are continuously moving towards success.
Critical assessment of the element of current organizational strategy
The generic amazon strategy that the company is currently using is described as
concentric diversification. The company is leveraging their technological capabilities and
advancement in order to provide best services to their customers. Also the company is following
the cost leadership approach. The company understand that markets of the industry is highly
price sensitive and customers look highly for low cost products. In order to have cost leadership
the company must make sure that they are having their cost of products low so that they can
provide the low cost benefit to their customers. Along with that, the company wants to make sure
that their websites are extremely easy to use so that customers can order with utmost simplicity.
The company wants to make the portal a go to application for all the shopping needs of the
company.
Indeed the strategy of the company was implemented successfully as the results can be
seen in the fact that they are the world's largest online retailers. the company has created their
own loyal customers base which helped them in having competitors advantage in the market and
has also made sure that the company is able to provide affordable prices for the best quality
products (Younis., 2019). The services of the company is fast, safe and secure which can help the
customers in having services which are best among the competitors. It is important for the
company to create competitors advantage in the market as it will help the company in having a
strong position in the market. It has been observed that cost leadership is directly related to the
Law of Diminishing returns which can provide losses to the company more than gains. The
company shifted their overall focus from cost to the better services of the company and its
applications. Only focus on cost leadership must be supported by any other factors which can
help the company in avoiding diminishing returns.

Analyse the element impacting the strategic aims of organisational scheme over the short and
medium term
The short term organisational goals generally refers to the the goals which the company is
going to achieve within a year. These are generally basic goals which helps the company in
achieving their overall long term goals. It is important for the companies to focus on their short
term goals as they will help the company. In case of Amazon, the company was not earning any
profits till the first several years of the company in order to focus on their long term goals. The
company was focusing majorly on creating a loyal customers service and understanding the
market pattern. The company made sure that they are understanding the customer base and in
attracting customers towards the products and services of the company.
It is essential for the company to make sure that they are running according to the
customers of the company and then eventually started making profits (Belokopytov and
Lashuk., 2019). It is important for the company to make sure that their customers are happy with
the products and services of the company. The growth of the company was more important than
the profits of the company so the short term goals of the company was growth which can help the
company in capturing a market share. It is important for the company to understand the market
first. If soon after joining the market the company started to think about profits then it is a greater
possibility that they will b\not be able to survive in the market in the long run.
The medium term goal of the company refers to the goals which take several years to be
completed. The medium term goal of Amazon, is to create a highly customer centric market. It
is important for the company to make sure that they are continuously upgrading their technology
and are becoming more advanced in the market than their competitors. It is important for the
company to have competitors advantage in the market as it will help the company in having
higher profits and to ensure that the company is able to satisfy their customers. The company's
major focus is on creating a dominance ion the market by providing best products and services to
the customers of the company (Maslova., 2019). With the help of their medium term goals the
company is able to capture the market in almost every segment of the industry and are providing
various of services. The company has build up trust in their customers base which is creating a
loyal customer base for the company.

TASK 2
Progress in achieving organisational objectives.
Different types of diagnostic and analytical tools to audit and assess improvement towards
existing strategic objectives and aims
SWOT analysis of Amazon:
Strengths:
 the company is the world's largest online retailers working effectively and efficiently in
the market. The company is making sure that they are providing best quality products and
services to their customers at best prices.
 The company is having competitors advantage in the market with the help of their best in
class technology and the use of e commerce.
 The company is having cost leadership in the market and its platform is one of the most
efficient online shopping online platform which is helping customers in ordering products
and services.
 The superior logistics and distribution network of the company helps the company in
reaching out to potential customers and in attracting customers (Gertsekovich and et. al.,
2020). The company is reaching to the every last mile with the help of their effective
supply chain.
Weaknesses:
 the company is slowing moving away from its core competencies because of their
diversification strategy. The company is moving its focus from retailing books and and
are creating a new focus point which can be a risky option for the company.
 The company is offering free shipping charges to its customers which decreases the
margin of the company on the potential products and services (Volk and Zerfass., 2018) .
The company is almost working on a zero margin business model which can have an
impact on the workings and business of the organisation.
Opportunities:
the company must focus on the security and privacy issues occurring in the online
market. The customers while dealing online have the biggest threat of privacy and if the

company is able to eradicate this threat from their system then they will be able capture that
online market more efficiently and will also be able to gather the trust of customers.
The company is having an opportunity to promote their own products and services. It is
important for the company to put more emphasis on their own brands so that they will become
independent and can capture the market with higher margins.
Threats:
 the company must make sure that they are not using aggressive pricing policies as they
may have to face lawsuits from publishers.
 The obsessive focus of the company on cost leadership can be a big threat for the
company as they may face losses due to this factor also the company is working on
almost Zero margin which is making the products and services of the company affordable
but are nit providing any benefit to the company.
evaluate the expectations of all stakeholders and their impact upon future organizational scheme
It is essential for the company to make sue that they are fulfilling the expectation of their
stakeholders in order to make sure that they are supporting the expectations of the company.
There are several stakeholders in the company which make sure that the company is running
smoothly and efficiently (Tang and Veelenturf., 2019.). Stakeholders of the company includes
employees, shareholders, customer, competitors, creditors, etc. it is important for the
organisation to make sure that they are working and are fulfilling the actual expectations of the
stakeholders. Some of the expectations of stakeholders are given below:
Shareholders: the aim of the shareholder is to get returns on the money invested by them
in the projects and management of the company. The shareholder expects that the company is
providing steady rate of return to them along with increase in the market capitalisation of
investment. The shareholders expect that their will be a steady increase in the future earning of
the company.
Employees: one of the major stakeholder of the company is its employees. It is important
for the company to make sure that the workforce of the company is satisfied with the workings
of the company which will help them in enhancing their performance and will ultimately help the
company in achieving their goals and objectives (Skrypnyk and et. al., 2019). The expectations
of employees are to get fair remuneration, to have stability in the employment and to get
appropriate benefits from the company which can help them in improving their performance.

Customers: The expectations of the customers is to get good quality of products and
services at fair prices and at fair terms. It is important for the company to provide value to the
customers and to make sure that the customers are getting value for the money they are paying.
Another expectations of the customers is that the company is working fair and are not involved
in any unfair practices.
Government: there are several expectations of government from the company. The
government expect the company to behave like a responsible company and to be a good
corporate citizen (Siwek., 2021). Non evasion of taxes and dues to government also to have
active involvement in the social causes so that the company will be able to contribute a little bit
in the society.
interpret and make an evaluation of the existing organisational strategic position and
improvement towards achieving the existing strategy
The existing strategic position of the company is to ensure that the company and its
brands are positioned in the market effectively. It is essential for the company to reach to its
target audience as it will help the organisation in making sure that the company is working
according to the gaols and objectives of the company. There are two categorises which are
needed to be taken into thought process by the company in order to capture the market. The
categories are given below:
 Finding the niche market: the company needs to focus on specific market ad must analyse
the needs of the marketplace. It will help the company in providing specific products in
the market. Once the company is able to capture the whole market it will be beneficial for
them to dominate that particular niche market (Pankova., 2019, November). The first step
is to find the Niche market as the company focused on providing market to the customers
online. Amazon made sure that they are capturing the market and are working
continuously on their IT segment which can help them in attracting customers and in
making a loyal customer base. So far the company is able to capture the niche market
effectively and the company is also able to create a loyal customer base.
 Another way of positioning the product is through differentiation technique. It is essential
for the company to make sure that they are running according to the markets of the
industry which they are targeting. The company is trying to have cost leadership in the
market and is also working in provide quality products and services to their customers in

lowest price possible. It is crucial for the company to dominate the market on the basis of
this factor but the company must also focus on their profits as well (Haider and Saetang.,
2020). So far the company is providing best possible prices to their customers and are
also attracting customers but the company is working on zero margin which means that
the company is not earning profits which can be harmful for the company.
TASK 3
evaluate strategic options to support a new strategic position
develop a range of choose strategic options to meet organisational strategic aims, way and
objectives in the short and medium term
The short term goals of the company is to put focus on technological advancement. The
company is also working on Amazon Drones which are going to provide delivery to customers.
It will help the company in providing fast delivery and will also make sure that their no vehicle
and transportation cost involved which will help the company in decreasing their delivery
charges and in creating an effective position in the market and in the consumer segment. It is
crucial for the company to innovate endlessly so that they can have the benefit in the market.
In context to medium term goals, the establishment must focus on their new brand owned
products which can help the organization in having profits and will also increase the margin of
the company. It will help the company in capturing the market and will also make sure that the
company is able to create a dominance in the market (Villena., 2019). The brand owned by the
company will help the company in making sure that the company is independent and is working
according to their own terms. The organisation is having effective strategies which are helping
the company in fulfilling their long term objectives. It is important for the establishment to make
sure that they are working according to the market trends and are doing innovation continuously
in their products and services so that they will be able to satisfy the needs and demands of their
customers and are also able to attract more customers.
Determine the active strategic option that can meet the altered strategic position
The company in order to meet its revised position must make sure that they are targeting
their core markets and are working according to the goals and objectives of the company. It is
important for the company to ruthlessly target the market and eliminate other kinds of non core
diversifications. The company must create diversity in cloud based services as it will be a better

strategic option for the company (Radyukova and et. al., 2019, December). The company can
increase the use of Big data by marketers as the company has already attained the market
leadership position. Another strategy that the company can adopt for is expanding their business
globally. It will provide an opportunity to the company to cater globally and will be able to
capture a big market segment globally which is extremely beneficial for the brand.
CONCLUSION
From the above report it is concluded that, strategic direction helps the companies in
implementing the strategic plan made by them in order to achieve their goals and objectives. It is
crucial for the organization to make sure that they are working according to the plan made by
them and are following all the step necessary so that they can effectively work in the
organisation. If the company is unable to provide essential directions to their teams then they will
not be able to guide them and eventually the workforce of the company will be misguided and
will not be able to achieve the mission and vision objectives of the company which will unable
the company to survive in the market as the company will continuously face losses.

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