BUSM4554 Case Study: Amazon's Issues and Challenges

This case study examines Amazon's contemporary management issues and challenges, focusing on its workplace environment, employee relations, and ethical concerns. The analysis identifies key problems such as employee dissatisfaction, lack of work-life balance, and potential violations of ethical guidelines. The study delves into the impact of these issues on Amazon's brand image, employee attrition, and overall market performance. Furthermore, the document explores potential solutions, including the implementation of human resource management strategies, the promotion of a positive workplace culture, and the removal of surveillance software. It emphasizes the importance of addressing these challenges to sustain Amazon's competitive advantage and maintain its position in the global e-commerce industry. The study highlights the potential consequences if Amazon fails to address these issues, including a decline in market share, reduced productivity, and damage to its brand reputation. The analysis incorporates relevant management theories, such as Maslow's Hierarchy of Needs, to provide a comprehensive understanding of the challenges and their implications.

Running Head: AMAZON 0
Contemporary
Management: Issues and
Challenges
Student Details:

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Introduction
In today’s business, competition is increasing across the globe with the change in workplace
environment. Companies are moving towards gaining a competitive edge by boosting
technology advancements where Amazon is one of them. The company is leading by giving
tough competition to other companies such as Alphabet or Google, Microsoft and Apple in
relation to tech boom used as Amazon’s game-changing approach. With the help of
increasing technology use, the company has made its position for providing best customer
experience by making innovation and leading in the marketplace universally (Bughin et al.,
2018). In this report, the objective is to analyse the case study of Amazon for identification of
key issues and challenges faced by the company along with evaluating the significance and
its implications on the business. The use of feasible strategies that helps Amazon to assist in
addressing the company’s key challenges and obstacles will be included in this report as well
along with analysing the risks, if not addressed properly.
Problem Statement
Amazon faced various challenges and one of them is in relation to employees as there are
several cases reported against the company based on the failure of effective management of
its workforce. There are various reports against the company which pushed towards creating
a “punishing corporate environment” that helps employees in Amazon to deliver desired
results. The problem faced by the company’s employees is there working hours where some
of them need to travel from far to reach at the Amazon’s warehouses that results in extending
their shift timings overall. Moreover, this also results in the affecting their both mental and
physical health negatively showing which is a major social issues required to be addressed
necessarily (Sepinwall, 2015). Another issue is related to the Amazon’s working culture

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where managers are tend to be very strict and creates high stress on employees by forcing
them for performing their duties. There is no time to employees to take rest or recover which
results is negative working environment for them and does not make Amazon a company to
work for as compelled. Furthermore, employees have to deal with their salary concerns where
they are paid less as compared to their rivals due to which, Amazon is ranked as 464th
company in Fortune 500 companies as per the PayScale (Choi, Li and O’Rourke, 2016).
These factors lead to increase in the ratio of employee turnover due to which the company
has to suffer from the rate of high attrition. Amazon faces the issue of team due to its average
tenure of 18 months in terms of the company’s employees which is lower substantially than
other companies.
Other than this, the company’s “always on culture” led to creating horrible situation for
employees where they were not able to take a single break from their work. For instance,
some of the company’s work of warehouses has been reported due to their factor of 11
seconds for scanning any new item in terms of meeting their quota. Also, Amazon’s actions
are monitored closely to ensure about not wasting even a single second. The software is used
by the company naming ADAPT in which data of employees is recorded for surveillance in
real time (Evans, 2019). The creation of culture in the company relating to micro-
management where employees’ actions are monitored 24/7 and they are always under the
surveillance of top-level management. Furthermore, some employees’ role affects their health
and well-being negatively in terms of physical demands. For instance, in Amazon, some
employees have to stand on their feet for 12 hours continuously in warehouses and have to
walk around 15 to 20 miles at the time of performing their duties (Spitznagel, 2019). Due to
this, the company has to face issues related to ethical challenges such as lack of employees’
management. Amazon has created a competitive culture where employees instead of helping
other to deliver better performance, keeps on trying to give their best due to which, conflicts

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arises between one another for improving their numbers and receiving better feedback from
top level management. This culture is supported by Jeff Bezos as well in an organisation
where he closely monitors the action of employees (Calma, 2020). Amazon goes through
screening job candidates strictly in terms of ensuring about selecting one able to handle
pressure in an organisation. The workers in company face threat of losing their jobs if not
delivered or performed as expected. One of the key social challenges faced by Amazon is
lack of fulfilment and understanding of needs of employees where the company taking
measures currently are not as effective to make sure about the employees’ health and safety
which is a key ethical concern for the company as well.
Case Analysis
After analysing the above mentioned challenges and issues Amazon faced, it is necessary for
the company to address them as they can affect its business negatively due to posing of some
significant implications. Moreover, it is essential to address these issues because they create
challenges for the company in relation to social, ethical, team and cultural management
(Eisenberg et al., 2013). In the company, employees are one of the key stakeholders
contributing success of the business where they are not able to perform with hard work and
dedication if Amazon will not value them as necessary to be done across the globe. However,
the creation of Amazon’ culture shows no priority given to the health and safety of
employees along with the management neglecting their basic rights for delivering outcomes.
Amazon performs several unethical practices by violating various guidelines in the
workplace. A good example of such violation is making the employees to stand-up for 12
hours straight without any break and making them walk 15 to 20 miles on regular basis
(Spitznagel, 2019). It is essential for the company to address such challenges and if not,
Amazon will create a negative brand image impacting in diminishing sales. The company

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majorly aims at profit maximisation but it is necessary to aim on building highly supportive
culture as well along with focusing on employees’ development in both professional and
personal context. Moreover, it is essential for Amazon to learn from its rivals such as Google
and Microsoft known for their practices of employee management effectively made them
leading company in the technology sector (Sánchez Abril, Levin and Del Riego, 2012). The
reason of addressing these issues can help employees to reduce their mental stress so that
they will not burnout in the workplace and will try to maintain their physical well-being as
well. Employees with maximum capabilities are required to perform which can only be
possible if they are not facing challenges of negative workplace environment.
Across the globe, Amazon is required to have the ability of building and retaining its
employees and team performing highly for sustaining its position in the marketplace for not
leading towards collapsing. However, current practices adopted by Amazon will harm its
image in the market that will reduce the performance of its employees. As per the Hierarchy
of Needs theory given by Maslow, employees cannot be satisfied in their jobs if their needs
are not fulfilled (Jonas, 2016). These needs are characterised into six groups which include
physiological, safety, love, esteem and self-actualisation. Since Amazon has failed to identify
and fulfil its employees’ needs, it is likely to face challenges while motivating them which
will hinders it productivity on a global scale.
Solutions
The challenges faced by Amazon can be addressed by the implementation of various human
resource management strategies and motivational theories. The organisation should offer
flexible working options to its employees in which they should be able to rest during their
shift hours and take break if they are exhaust from their work. Currently, a negative
workplace culture has adopted by the company because its employees have to compete with

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one another in order to move forward and their actions are closely monitored. Therefore, the
company should remove software such as ADAPT in order to avoid surveillance of its
employees and a healthier competition should be encouraged in which employees should
support one another rather than engaging in immoral practices to harm one another (Evans,
2019). In order to avoid engagement in unethical practices, Amazon should establish ethics
committee that should overlook the operations of its human resource management department
to make sure that employees’ rights are not violated by any business practices. The top level
management should also set an example for others in the organisation by formulating and
strictly following policies that supports employee development and positive workplace
culture.
Challenges for Amazon if no actions are taken
Amazon is a global leader in e-commerce sector and it will lose its position if it does not take
corrective actions to address its challenges. Employees enable Amazon to effectively deliver
high quality services to its customers which are a key to its success; however, it will face
challenges while delivering these services if it does not reduces its employee attrition rate.
The company will lose talented employees that contribute to its ability to innovate and
expand operations on a global scale (Chen, Liu and Portnoy, 2012). The organisation has to
understand that negative brand reputation could affect its sales and it can give an advantage
to its competitors that will increase their sales. If the company continues to lose its talented
workers than its competitors will become stronger and it will create challenges for Amazon in
the global marketplace. Negative publicity caused due to continuous complaints from
employees will harm the brand reputation of Amazon and it will become difficult for the
company to attract new customers. Its current customers who are loyal to the company will
also find it difficult to stay with the organisation if it does not focus on health and safety

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standards for its employees (Lee, Park and Lee, 2013). The top level management of Amazon
has also failed to take measures to address the challenges that will reduce market
capitalization of the company as its share prices will start to plummet. The organisation will
also face reduction in its productivity because the performance of its employees will decline
due to a negative workplace environment in which they are not recognised for their hard
work and they receive less salary as per there work (Nordlöf et al., 2015). Until these
challenges are resolved, Amazon will continue to face challenges that will affect its market
share in the e-commerce industry and it will make it difficult for the company to sustain its
competitive advantage in the market.
Conclusion
To conclude, Amazon is facing numerous challenges since the organisation has failed to
implement effective policies that eliminate ethical, social, cultural, and team related issues.
Currently, employees face negative organisational culture, unhealthy workplace environment,
low salary packages, lack of accommodation, no resting time, close monitoring of actions and
other challenges. The company can address these challenges by implementing strategies for
promoting flexible working environment, positive workplace culture, and removal of
surveillance software, encouraging employee development and others. In case these
challenges are not resolved by Amazon, it will affect the market share of the company by
reducing the productivity and performance of its global workforce.

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References
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Calma, J., 2020. Amazon employees who spoke out about climate change could be fired.
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