Workplace Culture and Its Impact on Organizational Efficiency

This report analyzes the workplace culture of Amazon and its impact on organizational efficiency. It includes a PESTLE and SWOT analysis, formal and informal groups, communication channels, and strategies to overcome barriers.

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Assignment Title: Workplace Culture and Its
impact on organizational efficiency
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Executive Summary
The report titled as Workplace culture and its impact on the organizational efficiency
has used the company Amazon as the business organization and gives an in-depth
understanding of the concept of workplace culture and what it takes to work in
accordance to the norms of the organization. A strategic situation analysis of the
organization is done in order to understand the strategic direction of the organization.
Workforce diversity, performance management and effective communication are the
three pillars to effective workplace in the organization as citied in the case analysis of
Amazon Incorporation.

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Table of Content
Introduction....................................................................................................................................................... 3
Findings and Analysis.................................................................................................................................... 5
PESTLE Analysis............................................................................................................................................... 5
Political Forces............................................................................................................................................. 6
Economic Impact......................................................................................................................................... 6
Socio/Cultural Impact................................................................................................................................ 7
Technological Impact................................................................................................................................. 7
Legal Factors.................................................................................................................................................. 8
Environmental Impact............................................................................................................................... 8
SWOT Analysis.................................................................................................................................................. 8
Strength........................................................................................................................................................... 9
Weakness........................................................................................................................................................ 9
Opportunity................................................................................................................................................. 10
Threats.......................................................................................................................................................... 10
Formal & Informal Groups at Amazon.................................................................................................. 11
Organization culture, values and Ethos at Amazon......................................................................... 12
Values at Amazon...................................................................................................................................... 12
Culture of Sustainability at the workplace.......................................................................................... 13
Innovation and Creativity...................................................................................................................... 13

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Customer centricity.................................................................................................................................. 13
Vision as the Culture................................................................................................................................ 13
Corporate social and environmental responsibility........................................................................14
Communication channels........................................................................................................................... 14
Amazon Chime........................................................................................................................................... 14
Social Media................................................................................................................................................ 15
Open Forums.............................................................................................................................................. 15
Barriers to effective functioning of organization and strategies to overcome them.........16
Workforce diversity................................................................................................................................. 16
Effective communication....................................................................................................................... 16
Performance Management.................................................................................................................... 17
Conclusion........................................................................................................................................................ 17
References........................................................................................................................................................ 18

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Introduction
Internet and Globalization are the two major contributors towards the state of the
organizational structure today. It is due to rapid globalization and proliferation of
internet and digital technologies which has led to numerous innovation and disruptions
to the existing business models. Amazon is one such company which was founded soon
after the Internet started spreading its wings. The company Amazon was founded in the
year 1994 by Jeff Bezos as an online book seller(Zhou & Wang, 2018). The company
which was founded at the back of a garage has now presence in more than 12 countries
and ships products across 130 countries. In the last decade Amazon has evolved from a
online book seller, to a full- fledged online seller and now it has further transformed
into a technology company. The vision of Jeff Bezos is to be the most customer centric
company on the face of planet and he also aims to sell anything to everything that I
customer might search online. Amazon is the largest e-commerce player which sells
products in the category of lifestyle, home décor, home appliances, consumer
electronics, consumer durables, Kids, tech products and many more such offerings(Tran
et. al., 2014).

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The e-commerce behemoth which has its headquarters in Seattle, earned a revenue of
US $ 136 Billion in the year 2016 and has more than 300 million active consumers on its
platform. The strategy of Jeff Bezos here is to provide customers with an enriched
customer shopping experience and provide them value deals so they always return
back(Wang & Luo,2017). Jeff believes in the power of remarketing and retargeting,
which helps the company to stay loyal to its customers. Policies and procedures at
Amazon are seen as customer centric, as the company gives paramount importance to
its huge customer base. Amazon has earned a great name for itself owing to its great
customer centric policies, selection of goods, fast delivery, superior quality of products,
curated shopping list and many such elements, which makes the company one of the
greatest the world has so far witnessed(Epstein, 2018).
Considering the above introduction as the preamble to the report, the report will
provide an understanding of the workplace culture and context with the view of
improving one’s ability to function within the norms of the organization. The report will
focus critically assess the culture and the context of the organization, evaluate the
organization using the management tools such as PESTLE and SWOT. The report will
delve into a deeper understanding of the concepts of impact of external environmental
forces on the organization, formal and informal relationships between the department

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and the people in the organization. The report will also discuss in brief about the culture
of the organization which is the reason for its workplace sustainability. The readers will
also get an insight on the ethical standards in the company, its value and belief system,
along with the communication channels used for sharing and building relationship with
the stakeholders. Towards the end, certain barriers to effective functioning of the
organization will be discussed along with the recommendation to overcome them.
Findings and Analysis
This section will focus on the external and internal environmental analysis of Amazon
with the focus on its workplace culture, values, beliefs, communication culture, ethical
standards and corporate social and environmental responsibility.
PESTLE Analysis
PESTLE analysis can be understood as an analytic tool which is used for strategic
business planning. The extremely important strategic framework is used to understand
the external influence on a business. The influence on the business is ascertained
according to different forces viz; Political, economic, socio/cultural, technological, legal
and environmental .The impact of these forces on Amazon will be ascertained in this
section.

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(Source: Makos, 2015)
Political Forces
The impact of political forces on Amazon can be ascertained by considering the
following three cases, which are:
 Political stability of the developed nations can be considered as an opportunity
for Amazon, as it gives the company leverage to expand its business operation
and do addition to its existing product lie. The political stability also provides the
company with the advantage of experimentation, this is the reason behind
Amazon’s drone delivery and Amazon go store are in beta testing in the
developed countries(Zhang et. al., 2015).
 Government support towards e-commerce can be considered both as a threat
and an opportunity for Amazon. The opportunity can be seen as the government
provides tax benefits and lax in its policies to develop the e-commerce sector.

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The threat can be in terms of increasing competition owing to the support of the
government towards the start-ups in the e-commerce sector.
 The increasing efforts of the government towards the increasing threat of cyber
security will help in bringing more customers to online shopping, thus
benefitting Amazon significantly.
Economic Impact
The impact of the economic forces on Amazon can be ascertained in the following
manner:
 The economic stability of the develop markets is a big opportunity as people are
open to buy good online, plus they have high purchasing power parity, which
helps Amazon to scale up its revenue and business.
 There has been an increasing trend in the disposable income of the people living
in developing countries, especially the APAC countries, this indicates that a large
number of people are shopping online, thus creating opportunity for Amazon.
 A threat of Amazon can be a possible economic recession in China, which would
impact the ability of Amazon to make a mark in the Chinese market(Rangel,
2018).
Socio/Cultural Impact
This is one of the major forces in the PESTLE framework, and its impact on Amazon can
be ascertained as:
 Growing wealth disparity of the people living in both the developed and
developing countries can be seen as a threat, as the rich and wealthy would look
for other ways of shopping due to the rising wealth disparity.
 The developing countries serve as an open market to Amazon, and the growing
consumerism in these markets can be seen as an opportunity for the
organization.
 The people are moving towards online buying, their habits have transformed
from traditional ways of shopping to online shopping. Thus creating opportunity
for Amazon(Jindal & Jindal, 2016).

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Technological Impact
Technology has a major role to play in the business model of e-commerce, the impact of
the force can be ascertained as:
 Technology in the present business day is getting obsolete with every passing
day, this serves as both opportunity and threat for Amazon. The threat in the
sense, technology can make the business model of Amazon look weak in front of
a new company with advanced tech. At the same time, R&D investment and
innovation in technology can help Amazon to outsmart all the existing and future
competition in the e-commerce sector.
 Increasing IT efficiency in the overall sector is a big opportunity of Amazon, as it
calls for better IT development to further expedite the process of online
shopping.
 Cyber-crime over the last couple of years is an alarming condition for Amazon.
The people would get wary in doing transaction online, thus limiting the ability
of Amazon to penetrate in the market(Drummond, 2017).
Legal Factors
The impact of legal factors on Amazon can be ascertained in the following ways:
 Increasing product regulation by government will help Amazon in curtailing the
counterfeiting activity, and will increase the ability of the company to provide
quality and original goods to the consumers.
 The ease in the import and export policies will help Amazon to cater to different
markets, and also to get sellers from across the globe on its platform, this is most
definitely an opportunity for the company(Vaidya & Khachane, 2017).
Environmental Impact
Every country is increasing its efforts to clean the nature and is punishing organization
which is degrading the environment. The impact of environmental forces on Amazon
can be ascertained in the following ways:

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 The interest of government in the environmental program can benefit Amazon
through its corporate social responsibility. The company would also spend more
to ensure the sustainability of the environment.
 The company is pushing its efforts to bring in 100% recyclable packaging, so that
the company can reduce its waste to the environment.
 Increasing popularity of the low carbon style is an opportunity for Amazon, as
the company can create an extensive energy saving process to build a brand
image in the market(Kumar & Qureshi, 2017).
The PESTLE analysis shows that Amazon has less impact of the environmental forces on
its business operations, however, it is advised that the company rolls up its sleeves to
leverage the existing technology and speed up its efforts towards the environmental
sustainability programs.
SWOT Analysis
SWOT analysis is an internal environment framework which helps the organization to
identify its strength and weakness which are internal to the firm, and also helps to focus
on the opportunity ad threat which is external to the organization. The takeaway of
SWOT analysis is that organization get to leverage on its strength, while minimizing its
weakness and staying strong towards the potential opportunity and threats(Poornima
et. al., 2016).
Strength
 The company has a strong background and a rich experience in the e-commerce
sector which is its biggest strength,
 The company’s policies are customer centric in nature, which makes its
customer’s value the firm.
 The company has a cost leadership as it always thrives to offer the goods at
lowest prices possible.
 Amazon has highly efficient delivery network and strong strategic partnership
with sellers who fulfil the requirement of the company.

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 Amazon adopts GLOCAL strategy, which is its international expansion strategy
which goes as “Go Global and Think Local”. This strategy has helped Amazon to
create a successful base in different countries.
 Amazon.com believes in acquisitions, the company has had several acquisitions
in the past which have helped the company to scale up its operations.
 Amazon cloud services AWS is the largest cloud service provider and also helps
the company in ensuring safety of the customer data.
 Amazon focuses on innovation and creativity in the organization, this has led the
company to create products such as Amazon Alexa, Kindle and Fire stick. This
helps the company in leading the race of tech companies(Belk et. al., 2014).
 Excellent customer service and social listening skills.
Weakness
 Amazon is facing troubles due to the shrinking profits margins; the revenue is on
an upward trend, but due to increasing competition and marketing efforts of the
organization its profits are being impacted significantly.
 Amazon has been at the centre of many tax avoidance issues in the US and India,
this creates troubles for the e-commerce giant.
 Some of the created products of Amazon did not scale up to the organization’s
perception, thus putting a deep hole in the pockets of the company.
 Amazon’s refund policy is not as effective in comparison to other players, and it
takes a lot of time to get the refund on the product returned(Herbich, 2017).
Opportunity
 Many countries are giving a nod to the click and mortar model, thus Amazon has
the opportunity of scaling up the customer experience by opening up Amazon
retail stores for its customers(Dhawan , Singh & Kumar, 2017).
 Increasing globalization makes it an opportunity for Amazon to foray into other
international markets.
 The growth in online entertainment will help Amazon to focus on Amazon prime
and make it a strong revenue generator.
 The company has strong growth opportunities in the Asian countries owing to
the strong growth and potential shown by these countries.

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 Amazon cloud services are the largest cloud service platform, this will be used by
various organizations to not only store data, but also be reliant on Amazon for
the cloud services.
Threats
 One of the major threats to Amazon is from its competitors Walmart and Alibaba.
Alibaba is the leader in China which restricts the growth opportunity for
Amazon, at the same time Walmart is getting into a click model which will
further impact the revenue of Amazon.
 There is a high governmental regulation related to foreign direct investment, it
can curtail down the expansion plans of Amazon(Flanagin et. al., 2014).
 Increasing threat from the domestic competition is another major worry for
Amazon.
 The recent cyber-attack RANSOMWARE puts a big question on the security on
the internet; this is another major threat for Amazon.
The SWOT analysis of Amazon reflects that the company has to expedite its work in the
technology sector and stay focussed on improving the customer experience and journey
on the website and other social and digital media platforms.
Formal & Informal Groups at Amazon
In a business organization formation of groups is extremely essential; the formation of
group can be either formal or informal. Formal group in the organization is created by
the top management to ensure the delivery of the organizational goals, whereas the
informal groups are created naturally in the organization with the intention of fulfilling
the social needs. At Amazon, due to high decentralization in the organization, plethora
of formal groups is created to work on a particular project. For instance, the marketing
team of Amazon web services is entirely different from that of the parent company
Amazon, each geographical location has its own group which handles the activities
pertaining to that particular area(Alvesson, 2012).
The different kinds of Formal group which exist in Amazon are:

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 Command Group-This is the group which comprises of managers and their
subordinates.
 Committees-Committees in Amazon are created for a short duration, primarily
to handle or resolve the conflict in the organization.
 Task Forces-This type of formal group is created to work on a particular task.
For instance, Amazon creates a task force while planning for an event for its
shareholders and stakeholders.
As mentioned earlier, the informal groups in Amazon are created on the basis of shared
interest, similar cultural values, likes and dislikes, language and attitude. These kind of
informal groups are pivotal to the organization as they help in building strong bonds
amongst the employees in the organization.
Organization culture, values and Ethos at Amazon
Culture at Amazon is one of the strongest reasons behind the success of Amazon. The
chief at Amazon, Jeff Bezos believes in creating such a culture which would drive
sustainability in the business organization. In order to do so, Jeff ensures a high level of
engagement with its team and always pushes the team to work on delivering smile on
the face of its customers. Jeff Bezos is a highly ethical leader, who takes accountability
for some of the unethical decision made by him at the start of Amazon journey.
However, he thinks those decision are callous and were important to the organization.
He does demands and portrays a high level of ethical leadership in the organization
which sets the tone of the culture at Amazon(Browaeys et. al., 2011).
Another important aspect of organizational culture at Amazon is the fitment of the
employees with the goals of Amazon. Jeff Bezos has clearly instructed the HR team to
look for the candidates not only on the basis of their skills, knowledge and experience,
but there have to be a fit with the organization. This helps Amazon in getting the right
candidates for the job, which is the right fit to their job roles and organization, thus
creating a culture of fitment in the organization(Deal et. al.,2011).
Another important aspect of culture at Amazon is the concept of work life harmony
which is strongly promoted by Jeff Bezos. Jeff is of the opinion that one should always
carry forward the positive energy at the workplace, and the same should be

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transformed into bundle of positive energy in personal life. This will help the employees
to perform at their optimum best and not feel any kind of negativity while working at
the organization(Cork,2011)
Values at Amazon
Ethics- Amazon practices ethics in all its business dealings and transaction, ethics is
also practiced by all the employees working at Amazon.
Relationship building- Amazon believes that in order to build a sustainable business
model, the essential thing is to build strong relationships with all the stakeholders of the
organization.
Integrity- Amazon asks all of its employees to adopt integrity in all their business
dealings and transactions.
Customer centricity-Amazon keeps customers as their top priority and all the
organizational policies and procedures at Amazon are a reflection of its high customer
centricity.
Culture of Sustainability at the workplace
Jeff Bezos the chief at Amazon understands that life cycle of Business models are
shrinking year on year, and if the company has to create a sustainable business model in
the organization, it has to focus on creating a culture which nurtures and promotes
sustainability. Some of the elements of sustainability of culture at Amazon are:
Innovation and Creativity
At Amazon, there is an ingrained culture of innovation and creativity. Jeff Bezos is a firm
believer that in order to create a sustainable business model it has to encourage
innovation and creativity in the organization. Thus, the employees of the organization
are rewarded for their innovation effort towards the sustainability of business
model(Rogoff, 2003).

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Customer centricity
Customer is the king, holds true even to the present day. Amazon has taken it to a whole
new height by keeping the customer at the centre of every business process and
policies. All the process in Amazon is inclined towards the customers and how to make
their lives easier. This value as the culture is deep rooted in the organization, which
creates a culture of sustainability in the organization(Prince & Prince, 2011).
Vision as the Culture
The vision of Amazon is to become the most customer centric company on the planet
earth and provide every possible item which a customer might search on the web. Jeff
Bezos has made it mandatory for all the employees working in the organization to by
heart the vision, and translate the vision into the culture of the organization.
Corporate social and environmental responsibility
There are no two arguments over the fact that Amazon and Jeff Bezos are the biggest of
philanthropist for the community, however, the contribution of Amazon towards the
environment and CSR is not that minute. Amazon has created a website by the name of
Amazon smile as its initiative towards its CSR activity. The company here allows for
fund collection through the website, and also lets the people purchase a product for a
needy person. This effort and unique strategy of Jeff Bezos is strong appreciated by its
stakeholders all across the globe. In addition to this, Amazon also makes significant
contributions towards the improvement of education and the knowledge of Internet
amongst the growing population.
As an initiative towards environmental sustainability, Amazon is coming up with 100%
recyclable packaging material. This will be a noble step of Amazon towards keeping the
environment the way it is. Another initiative of Amazon is planting of trees, Jeff Bezos
requests all its employees to at least plant two trees in a month. Another initiative of
Amazon is inclined towards reducing the carbon footprint, in order to do so, Amazon is
using energy efficient device as part of its environmental responsibility. Thus, it can be
easily said that Amazon is behaving like one good citizen, who is focussed on uplifting
the community and also ensure the sustainability of the environment.

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Communication channels
Amazon is not only the largest e-commerce company on the planet, but it is also one of
the largest tech companies which are changing the lives of people across the globe. At
Amazon, communication plays a central role, and technology and techniques are used to
ensure a good communication channel in the organization. The communication
channels are the combination of both the traditional and contemporary tools, some of
which are:
Amazon Chime
Amazon Chime is the latest tool of Amazon which provides a unified communication
service to the employees of the organization. The collaborative communication tool is
an excellent service which makes the meetings in the organization easier and more
efficient than earlier. Amazon Chime also allows for an audio or video playback without
any hassle, it also facilitates for smoother chat while in meeting, sharing of screens,
sharing of content and can be easily integrated with any of the devices. Thus, Amazon
Chime is one in –house service used by Amazon which helps it in delivering better
engagement with the employees. Such an effective system helps in building strong
relationship with the stakeholders in the organization(Handy, 1984).
Social Media
Social media has become a pervasive technology right since its inception a decade back.
Amazon, which is an e-commerce company, focuses on Social media channels to build a
strong community of its employees and also to create informal groups in the
organization. Various stakeholders in the orgniazation use the social media channels to
communicate important notification, reward the employees and also to create small
project specific group. The 2 way communication platform acts as a good tool for
relationship building due to high levels of engagement and the ease of usability of the
platform. Besides managing the communication internally, the company also uses the
channel to do effective social media listening of its customers. The platform allows for
fast revert to the concern and query of the customers.

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Open Forums
Jeff Bezos is of the opinion that it takes two to tango in the business space, he believes
that openness in communication has to be from both sides. He believes that both type of
communication makes sense to the business, such as the top down and bottom up
approach. Thus, in order to ensure transparency of communication in the organization,
Jeff Bezos asks its manager to be highly transparent and empower the employees in the
decision making. This would ensure good participation of the employees and they
would be able to communicate their concerns, feedback or grievances more openly. As
an extension to this culture, Amazon conducts a monthly open forum discussion where
employees can communicate freely on matter of important and strategic discussion in
front of the top management. This is one of the best communication channel strategy
which is deployed by Amazon and it helps the company in building a strong relationship
with its employees(Lawn & Grace, 1987).
Barriers to effective functioning of organization and strategies to overcome them
Organization faces various barriers which have to be dealt with seriousness to ensure
high momentum in the organization. Some of the barriers which are faced are:
Workforce diversity
Organizations are big promoters of workforce diversity because of the realized benefits
of the diversity concept. It helps in fast decision making and puts new ideas on the table
which helps the organization to learn and grow. However, workforce diversity in the
organization is difficult to implement due to high resistance shown by the employees
and managers. They see people with diversity to be a threat to their jobs and are unable
to understand the cultural difference, which creates troubles in the organization(Molla,
2017).
In order to overcome the barrier of workforce diversity, the organization has to focus
on increasing the understanding of cultural differences in the organization. Training will
also aide the employees to adopt and better understand the culture, also, efforts by
managers to build diverse functioning teams which will help in better decision making.

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Effective communication
A lot of organization falters in the absence of ineffective communication in the
organization. In the absence of formal and informal channels of communication, the
employees are left to perceive and interpret the things on their own, which creates
troubles in the organization. Ineffective communication also leads to inability of the
organization to pass clear set of instruction and goals to the employees(D’Onfro,2015).
In order to alleviate the trouble of ineffective communication in the organization, a lot
of communication channels and tools have to be used. Social media can be used as an
effective tool for communication, other than that the managers in the organization can
build a culture of openness in the organization.
Performance Management
It is important that organization continuously monitors the performance of its
employees and allow for feedback on a continuous basis. At the same time, the goals for
the employees have to be set in accordance to the goals of the organization. In absence
of clear goal setting the employees are left with no clear direction or path to follow.
Thus, they are aimlessly working in the organization as their goals and KPI are not been
defined. In the similar manner, in absence of a comprehensive performance
management plan, the employee is not able to identify the gap in his performance which
in turn affects the productivity of the organization(Das & Ara, 2015).
In order to overcome the challenge of performance management, a 360 degree
performance management plan has to be implemented in the organization. This plan
will help in providing a timely and continuous feedback to the employees, which then
can be used to improve the performance. Akin to PMS, SMART goals have to be defined
for the employees in sync with the organizational goals and objectives. This would
result in enhanced productivity in the organization.
Conclusion
Amazon is the largest e-commerce company on the planet and its founder and CEO are
determined to make Amazon as the greatest company in the world. In order to make

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Amazon greatest sustainability in its business model and culture is a must. The
organization also has to ensure that a smooth communication prevails in the
organization, and the company uses plethora of communication devices to ensure the
same. Workforce diversity brings out the best decision and also helps in creativity and
innovation in the firm; this should also be the culture of the organization. It can thus be
concluded by saying that the organization has to work towards its culture in order to be
sustainable in the longer run.
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