Analytical Report on Amazon's Supply Chain and Procurement Process

This analytical report examines Amazon's procurement and supply chain, focusing on its operations, integration, and sustainability. The report begins with an executive summary and introduction, then proceeds to analyze various aspects of Amazon's supply chain, including supply, operations, and information analysis. It delves into the company's visions, missions, and strategic goals, providing findings on supply analysis, such as delivery times and transportation costs. The operations analysis section explores technological support, warehouse management, and employee training. Information analysis covers customer satisfaction and website optimization, while the integration analysis examines the synchronization of different elements within the supply chain. The report also addresses sustainability, emphasizing the need for Amazon to adapt to future changes in technology and consumer preferences. Discussions on improvement programs and their impact on achieving the company's goals are also included, concluding with recommendations for enhancing Amazon's overall supply chain performance.

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Table of contents
Content Page number
Cover page ………………………………………………………………………………………..1
Table of contents ………………………………………………………………………………….2
Executive summary …………………………………………………….........................................3
Introduction………………………………………………………………………………………. 4
Findings on supply analysis ………………………………………………………………………5
Findings on operation analysis ……………………………………………………………………6
Findings on integration analysis…………………………………………………………………..8
Findings on sustainability………………………………………………………………………... 9
Discussion of company’s procurement and supply chain analysis
……………………………………………………………………………………………………10
Discussion of improvement of programs……………………………………………………….. 13
How the improvement of programs can assist the company to achieve its visions, missions and
strategic goals…………………………………………………………………………………… 15
Conclusion……………………………………………………………………………………… 16
Reference …………………………………………………………………………………….
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Executive summary
Analytical report seeks to identify problems in a company, organization or an institution by
critically looking into its activities. The report identifies who the problems affect and seek to find
solutions through recommendation. Research is carried out to identify loophole so as to find a
solution and identify why the previous strategies put in place failed. Analytical report on
procurement and supply chain observes weaknesses in the process and recommends on steps that
should be taken to solve the problem at hand.
Amazone.com is an ecommerce company that sales its goods online. Products from Amazon
company are video downloads and streaming, mp3 downloads and streaming, videogames, toys
as well as food. Goods are supplied to its warehouses in various parts where they are sold to
retailers and individual consumers once they place an order by online means. Retailers then
deliver the products through their shops or home delivery. Because of the advancement in
technology, majority can access internet and order the products online. Procurement is the
process of acquiring raw materials, equipment or services from suppliers. Once a requirement
has been identified by the company, it is approved and the process of procuring the goods starts.
The process of acquiring raw materials should be carefully done to make sure the raw materials
are environmentally friendly, good quality and the desired quantity. The supplier or contractor
chosen should be the one that provides the best quality at relative prices. Having improvement
programs helps the company meet its requirement and achieve its missions, visions and goals in
future. Such continuous programs are also important so that the company can sustain the
changing business environment and technology.
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Introduction
Supply is the distribution of goods from the manufacturer to consumer through a process (Soucy,
2011). Supply chain is a complex way that shows how the supply of goods runs from the source
to the final. Amazon Company is an Electronic business based in Seattle, Washington America
("An In Situ Leaf and Branch Warming Experiment in the Amazon", 2011). This company is
owned by Jeff Bezos who founded it in 1994. Amazon.com Website started as a bookstore and
later broadened to sell video, audio, audiobook downloads and streaming, software, videogames,
food and jewelry. It is the second largest ecommerce in the world after Alibaba.com in terms of
total sales (Baugh, Ben-David & Park, 2014).
Visions, missions and strategic goals
Visions are ideas in the mind of an individual or where a company sees itself in future. Visions
help a company to always work to see itself in the pictured position (Amazone & Lewis, 1996).
Missions are the strategies and plans that re put down to achieve the mission and goals are
statements of what a company seeks to achieve (Vargas Leon & Kuehn, 2014). In any company
operations, the three are the key drivers of all activities.Amazon.com aims at providing the best
quality of services and quality of goods to maintain its position as the top most e-commerce
company in the world (Baugh, Ben-David & Park, 2014). The company wants to be the most
digitalized company in the world and always provide up to date services and information.
Findings on supply analysis
As Amazon.com operates online, the supply of goods is done after a customer places an order,
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and it then reaches the warehouse where an employee sorts the kind of goods the customer
wants(Tombs & McColl-Kennedy, 2013). The product is then placed in crates on a conveyor and
passed through the distribution Centre where it is matched with the customer’s order, placed in
a boxed and then sent to the buyer through the US postal service ("Plan B for anti-miRNA",
2013). Goods reach the customer within seven days after placing an order. The process seems so
first and simple but there could be ways of making it better. Goods can take a maximum of seven
days before it arrives to its destination which means a customer should be patient and in times of
emergency, the customer may be inconvenienced(Osherovich, 2011). Therefore, Amazon should
take an initiative of improving the time of delivery by opening smaller warehouses in different
states for them to be closer to every customer. They can also partner with dealers to represent the
in various parts. When shipping goods to a customer who is far from the warehouse, the cost of
transportation will be very high compared to a closer one hence the need to open up minor
warehouses to cut the cost of transportation(Cucchiella & Koh, 2012). The costumer needs to be
assured of the exact time his or her order will be arriving for their own good. Sometimes,
mishandling of goods on transit result to the products arriving to its destination while it has spoilt
already, this can bring loses to the company and inconvenience its customer which may make the
buyer cease from purchasing goods from the company.
Findings of operations analysis
the operations of any business depend on its management and strategic organization of the
company (Weber & Chapman, 2011). Amazon Company is an ecommerce business which highly
depends on the technological support. Its operations are should be based on an improved and
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advanced technology so as to offer quality services. The warehouses should be located in an area
where their customers are concentrated (Coyne & Wing, 2016). As the company continues to
expand, there must be strategic plans to help it compete well in the market and sustain the future
changes in the market. The company should use technology to ensure that their online customers
get the best quality services. Amazon should encourage its employees to be innovative and
creative enough to be able to come up with new and improved ideas so as to meet the
expectations of the customers (Jackson, 2012). systems should be automatic to receive any
number of orders simultaneously, without automated systems, other orders may delay yet the
customers is waiting for the delivery of goods .To get competent workers in the warehouse, new
employees should always pass through a temporary employment period to determine their
efficiency and skills in production before getting a permanent employment(Marren, 2012). These
employees should be trained from time to time to enhance and broaden their skills. The supply
management should always ensure that there is sufficient inventory in the warehouse to avoid
cases whereby a customer places an order and it is not within the warehouse ("Journal of Family
Business Strategy: 2013 Call for Papers", 2013). All goods in the warehouse should always be
inspected in prior time to ensure that they are all in a good condition and the required quality and
quantity so that when a buyer places orders; a final inspection is done then shipped.
Findings of information analysis
During any production of goods and services, the ultimate person to be considered is the
customer. In any business, customers are always right and they should be satisfied with the kind
of services they get. Amazon Company should always keep its roots on the ground to know the
taste and preferences of their customers ("Journal of Family Business Strategy: 2012 Call for
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Papers", 2012). This will help the business know the kind of goods to keep in the warehouse as it
awaits orders from buyers. Amazon should be well informed of the cost of similar goods by
other producers to be able to know how much to charge their customers. Buyers always want
affordable prices of high quality; therefore, goods produced should be of high quality to meet the
demands of consumers. Amazon’s customer are all likely to be literate and have a class of taste,
therefore goods in the warehouse should be produced to match the preference of the prospective
customers (Soucy, 2011). Amazon should always inspect and service their computers and
Websites to ensure that at no point, the technology being used fails the company. The way of
placing orders should be simple to the customer because complicated system may confuse the
buyer. All goods available in the warehouse should also be posted with their description so that
customers know what exactly to order. There should be a wide range of the same product for
buyers to have larger range of making choices according to the prices of goods, quality and
quantity.
Findings of integration analysis
integration are the process of bringing different elements, combining them to make a complete
unit. During supply, there are different elements that should be considered and synchronized.
New technology should be brought into the picture and applied together with other elements such
as political, social and economic matters (Soucy, 2011). To create a good supply network, the
economy should be considered to ensure that funds used in the processes are reduced as much as
possible Proper modes of transport during supply should be used for example, the company
wants to supply goods to other countries, the air should be used because it is faster and a large
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amount of goods should be transported at once to avoid wastage of resources With the new
technology, almost every part of the world can access internet hence the company should create a
website where people order their goods. Amazon has a website in place where its customers can
place orders of goods and services to be provided for them. This company should also create a
platform where its customers can interact, share ideas and opinions. These communication
platforms will help the company know the real feelings of their customers by the way the talk.
This will enable Amazon to know where to correct their mistakes and get a chance to clarify
things with their customers (Soucy, 2011). When goods re ordered, the company should analyze
and see products that need to be shipped to the same area or close areas so that they can be sent
at once to avoid too much expenditure by sending goods one by one.
Findings on sustainability
Company sustainability creates a long term survival of the business, the present and the future of
a business can be run smoothly so as to meet objectives and goals. There should be strategies put
in place that will make Amazon.com be able to run for long. Amazon should ensure that is has
organized itself to be able to sustain future changes in environment, economy and change in
technology .Product produced as per now by Amazon suits the current environment, economy
and technology but what of the future? Things have been changing from time to time, if one
looks back into hundred years ago, the way of human living and operations were quite different
from now("Journal of Family Business Strategy: 2013 Call for Papers", 2013). Things have been
improved and changed for instance; Amazon started as a book selling store to the now video,
audio and games business. this is because less people are now interested in books unless they are
carrying out coursework .Amazon should therefore employ innovators to keep improving their
products and bring in new ideas that are likely to be in place in the coming years For the
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company to be able to sustain changes, it should be changing the way of its production and
supply (Soucy, 2011). New techniques should be employed in the supply chain as well.
Sociologist should be consulted to know how the needs of people from different places vary
from time to time. If all these are carefully implemented and thinking ahead, the company shall
be able to supply its products no matter the changes that might occur in future.
Discussion of the company's procurement and supply chain analysis
Procurement is the process by which a company acquires goods or services by finding source of
goods, agreeing on terms from external sources. It could be done through competitive bidding or
giving out tenders to prospective suppliers. Procurement involves selection of vendors,
establishing terms of payment ,vetting ,selection, negotiation of contracts and the final process if
actual purchasing of goods. Amazon.com caries out procurement process to acquire necessary
equipment used in the production of goods and services. There are policies provided by Amazon
to its suppliers. Any supplier to this company should adhere to the rules and regulations
governing its local and global business (Soucy, 2011). Since it manufactures a range of products,
it means that they have suppliers from different parts. Amazon should therefore make sure that
all these suppliers consider human rights, labor health and suppliers should make sure that they
deal with products that are environmentally friendly. Once a requirement has been identified in
the manufacturing company of Amazon, authorization of purchase is given about and then
approved by the procurement manager whereby the procurement process begins. Suppliers are
identified and then receipts and quotations are inquired. The company then negotiates for the
prices of goods .the vendor is then selected followed by acknowledgement of purchase order .An
advance shipment notice follow the order as well as goods receipts and invoice recording and the
supplier are finally paid (Muntean, 2018). Because of the many suppliers it has, some of them
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require order through online means .Amazon should make sure that they are always up to date on
different ways of making purchases. The company also should ensure that they have an exact
quantity of supplies needed and the change in consumer requirements. Without this knowledge,
products procured for could be of no essence to the company due to the fluctuation in the
consumer preferences. To avoid ordering the wrong goods, the identification of requirement
should be critical to know if the real amount of goods needed and the essence of the requirement
in the manufacturing. Once goods have been ordered, thorough inspection of goods should be
done to ensure that it meets the requirement by the company in terms of quality, quantity and
description. After products have been manufactured to the desired final goods, they are stored,
taken account of then supplied ("Journal of Family Business Strategy: 2013 Call for Papers",
2013). The company which is the main producer supplies it to other warehouses who buy goods
in wholesale and later supply to individual consumers. During supply, there are various aspects
that should be considered such as respect for human rights (Soucy, 2011). Suppliers should be
handled with respect in accordance to rules governing employer-employee relations. Payments
should be made with appropriateness, ethical issues should be observed and avoid child labor at
any point. According to dynamic alignment model, companies should ensure that they adapt to
the continuously changing business environment to be able to sustain itself in future. Companies
should effectively align managers, leaders and its workers in a clear and wise strategy. Each and
everyone involved in the company’s procurement and supply should be put there strategically in
that they fit to work in terms of their capabilities and talents. They should be able to work under
different environment since the business environment keeps changing from time to time. To
operate in the dynamic business world, Amazon Company should build strategic plans to
establish goals, well organized way of doing things and accountabilities that work towards
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improving performance(Muntean, 2018).. The company should make it possible for employees
to accomplish goals by providing flexible tools and resources. The managers and leaders should
live in their values to act as role models to the rest of the staff, meet their achievements so that
when they are challenging the employees, they are in a position to correct them and motivate.
The following illustration is the dynamic alignment model.
(Tombs & McColl-Kennedy, 2013).
Discussion on improvement programs
as time goes, there are technological changes; there is cultural shift in the way the consumers
think, does his or her things and opinion changes over time(Muntean, 2018).. In the world of
business, the customer is always right no matter how they prefer things done, business people
have to be flexible enough to move with the changes in priority by consumers. This is why there
should be improvement programs to make the company moving and be able to sustain it in future
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("Journal of Family Business Strategy: 2013 Call for Papers", 2013). The Company needs to
look into its way of operation, process of production and infrastructure critically to note down
things that need to change or improve because there is change in technology. Some things tend to
become obsolete as time goes by which could later inconvenience the company. Investment of
time, resources and energy should be continuously improving. The culture and traditions of
Amazon Company should also undergo improving strategies. To make successful improvement
programs, the company should advance its leadership organization. There should be leaders that
work towards future better performance of the company. The leaders should be reasonable
people who have independent minds, embrace teamwork and make sober decisions Leaders
should exhibit behaviors that that work towards reaching the goals and can set good examples to
be emulated by their juniors. If the leaders do not initiatives put in place to improve company
behaviors, it is impossible for employees to accomplish the company’s targets(Soucy, 2011).
This company should focus on prevention of problems rather than waiting until it occurs then it
looks for solution ("Journal of Family Business Strategy: 2013 Call for Papers", 2013). The
managers should work smart and not hard, by this it means that they should be able to look in to
root cause of a problem instead of just fixing it. Some cultures of rewarding employees who
solve problems should be avoided and instead, encourage and reward those who find the causes
of problems. Solving something just works temporarily but once a root cause has been
established, the effects are long term.
The company has to have a continuous focus and should not be destructed or stopped by smaller
challenges. Once a goal has been set, it should be given attention until it is accomplished. Efforts
towards improving an organization should be continuous and permanent. In the process of
program improvement working, pieces of the process should be optimized instead of looking at
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the process as a whole. As much as the company focuses on a bigger thing, strategies put in place
should be to improve from one level to another. There is no way accompany can wake up one
day and change everything at once. Auditing can be done quarterly so as to follow up the
improvement programs (Muntean, 2018). This means that the process shall be embraced at all
levels of production and positions of everyone working in the company.
How improvement programs can assist the company to achieve its visions, missions and
strategic goals
Amazon.com focuses on providing its employees with trainings and tools so that they can
perform their duties competently. These include providing safety during operations and reduce
the risk of harm (Choi & Li, 2015). If the strategy of updating and checking machines and
equipment is implemented, the company shall be able to avoid any accidents in future .Regular
training of employees will keep them up to date and make them improve on the skills and quality
of services. Training also helps employees know how to relate with each other which brings
about teamwork and unity. Process and routines are important for the continuous effort of
making the company better in future. When the process of implementing plans is kept
continuous, the company will use less effort to reach its goals because the activities are
distributed over a period of time (Wagner & Svensson, 2014). Programs help the company
achieve its goals within a shorter period because the plans shall be followed. If the company
targets something at the end of the year, strategic programs will propel it. With the continuous
improvement of technology, there is change in the descriptions of goods demanded. Therefore,
goods in the warehouse should fit the technology in existence and meet the demands of the
consumers (Choi & Li, 2015). Therefore if the infrastructure and production equipment is
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updated, Amazon shall be able to produce up to date product hence sustaining the changing of
environment. Planning future activities in advance will make the company competitive enough in
the supply market (Muntean, 2018). When making procurement, goods ordered shall be
appropriate for production of improved quality and efficient products.
Conclusion
In any company that deals with production of goods or services, procurement and supply is a
mandatory. Raw materials, equipment and services required in production need to be purchased
(Tombs & McColl-Kennedy, 2013). For instance, Amazon is company that provides its goods
and services online but the production is done in the warehouse therefore, there is need to
acquire raw materials and services from suppliers, the purchase process is procurement
(Cucchiella & Koh, 2012). After final products are out, there is need to supply to consumers who
are in various parts of the world therefore, these goods go through different people at different
levels before reaching the final person who is the customer("Journal of Family Business
Strategy: 2013 Call for Papers", 2013). The process may have some loopholes, the have been
analyzed in the content above and recommendations have been provided. If all of them are
implemented and corrections are done where necessary, this company will be in a better place
and able to compete in the market with other manufactures of similar products.
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