MGT501 Business Environment: Comprehensive Amazon Stakeholder Analysis

This report provides a comprehensive analysis of Amazon's stakeholders, examining both internal and external groups and their influence on the company's operations. It identifies key functional areas within Amazon, differentiates between stakeholders in different industries, and details the roles of internal stakeholders such as directors, investors, and employees, as well as external stakeholders like customers, suppliers, and the community. The report explores the nature and degree of stakeholders' interests, highlighting potential conflicts and their implications. A stakeholder matrix is created to determine the level of influence and interest of various stakeholders, and the report discusses Amazon's CSR strategies in addressing stakeholder interests, particularly customers and employees. The report also emphasizes the importance of understanding stakeholder expectations to ensure business success and address concerns related to ethical practices, environmental impact, and customer satisfaction.

BUSINESS ENVIRONMENT

Executive Summary
This report analyses and brings out a discussion on stakeholders of Amazon and in what way
they affect the business operations. This report describes the conflicting stakeholder’s
decisions such as cutting down the business decisions, adding extra shifts in order to increase
the factory ability, introduction to the new machinery in order to replace manual work. On
the other hand, these decisions would be likely supported some of the stakeholders such as
shareholders and banks, customers, suppliers, employees, local community, and investors.
The report elaborates and identifies each of the stakeholder who is engaged directly or
indirectly while operating the Amazon. There is a brief distinguishes between the
stakeholders of two industries. Further, a stakeholder mapping has been identified the
stakeholder anticipations and the power which assists in grasping political priorities. It will
describe a strategy that has been pursued by the organisation while identifying the
stakeholders and their relation to level of power, which they hold, and the level to which
stakeholders show interest while supporting particular strategy.

Contents
Executive Summary...............................................................................................................................1
Introduction...........................................................................................................................................3
Identify functional areas........................................................................................................................3
Difference between the stakeholders of other industry..........................................................................4
Identify internal and external stakeholders and their roles.....................................................................4
Identify the nature and degree of main stakeholders’ interests, and implications of Conflicting
interests.................................................................................................................................................7
Create a stakeholder matrix...................................................................................................................8
Conclusion...........................................................................................................................................12
References...........................................................................................................................................13

Introduction
Amazon is one of those few companies, which is benefited from the first mover advantage in
early 2000. The company uses cloud computing in order to practise the incorporated business
model, which allows the functioning efficiently in complex, advanced and rapidly increasing
internet industry. Being such a large operator, Amazon will have to address different
underlying stakeholders. This report will carry out a discussion on specification of each
interest of every stakeholder, which is associated with the company and the objectives.
Further, the power of the shareholders and their interest that will be based on stakeholder`s
matrix. Internal as well as external stakeholders exert pressure on the organisation that
changes the way of decision-making. Internal stakeholders are within the organisation who
operates within the system and has the power to influence the decision in an effective very
directly or indirectly. For instance- employees, workers, trade unions, top-level management,
middle level management are some of the important internal stakeholders. Whereas,
investors, customers, community and government agencies are some of the important
external stakeholders (Ferguson, 2017).
Identify functional areas
Marketing
Supply chain management
Human resource management (Personnel)
Finance
Customer service support
Operations

Information and communication technology
Administration
Production
Distribution
Research and development
Difference between the stakeholders of other industry
Different stakeholders have different roles in different industry. In this report, the discussion
carries on identifying the internal and external stakeholders in Amazon. In this case,
customers, employees, Director, investors, top level management, local community,
government, Banks, non-governmental agencies, retailer, distribution channels, and suppliers.
On the other hand, healthcare sector have different stakeholders such as nurses (employees),
patients (customers), distributors, suppliers of medicine and equipment, pharmaceutical care,
service users, health, social care, service users, trade unions, member of local community,
government and their agencies. Other more stakeholders are national inspecting bodies,
quality assurance in terms of healthcare such as NICE. This shows there is a huge difference
between the working of two different industries and both of them have different stakeholders
(Almeida, Marimon, Casani, & Pomeda, 2015).
Identify internal and external stakeholders and their roles
The company has started as a bookstore where the stakeholders were publishers, book
wholesalers, and writers. As the company expanded to an online retail store and it starting
engaging in various dealings. Main stakeholders, which Amazon has to consider, include
investors, board of directors, strategic partners, suppliers, employees, and customers. Every

partner will be affected the company`s operations either directly or indirectly. Therefore, each
stakeholder affect the strategic decisions in one or the other way.
Director and investors
The investor and the board of directors anticipates that the company will grow and return
more profits (Ferguson, 2017).
Senior management level
Management have the responsibility to provide greater return to the investors by enhancing
the customer innovation with the addition of cost efficient business model that can boost the
organisational profitability (Ferguson, 2017).
Employees
Employees expects that the organisation will provide them job security with higher salary.
Employee also expects career development plans and strategy from the organisation. The
company values workers which is regarded as the determinant of company`s performance and
CSR policies. Employees are highly interested in career development and competent
compensation on the basis of organisational culture (Ferguson, 2017). Amazon satisfies these
stakeholders with the help of personal leadership plan and reasonable compensation policy on
the basis of their higher growth potential. For instance- the organisation offers high
compensation to its IT professionals involved in creating and maintaining the technological
assets, which are related to assets of e-commerce business. The company has been
continuously growing globally that can generate career progression prospects for the
employees (Ferguson, 2017).
Suppliers and other supply strategic partners- suppliers anticipate that the company will
allow growing and expanding so that company could get benefit from the company`s name.

Customers- consumers anticipate higher quality goods and services at the best prices from
the retailers. Customers want that their transaction remains same with the ease of purchasing
transaction. Customers expect the data and information so that they can remain private and
confidential in order to conduct reasonably fair corporate practise in regards to services at all
the times. This will result into addressing the issues and complaints, which will comply with
products promptly (Ferguson, 2017). For instance- the organisation uses advanced ICTs
(information and communication technology) in order to protect those remain orders that
remain cart stake. For instance- the company will use effective technologies so as the trained
people where technology ensures customer convenience. Further, the fair price among the
sellers of the company will deal with the company`s online deadline and its level of
competitions with the help market price based strategy. Further, the company`s approach
towards CSR will lead to addressing the interests of the customers as there are the main group
who affects the organisational dealings (Kolkowska, Nöu, Sjölinder, & Scandurra, 2017).
Community
Community comprises of publics, which are probably concerned with the social
development. The company maintains a CSR program for the communities. Stake///holders
are important because they affect consumer perception for the organisation’s goods. The
community interest includes education, development support, conservational environment
strategies, and healthcare. The organisation would address interests, which considers support
arms for primary community. For instance- with the help of Amazon smile, the company
generates a considerable proportion of the sales revenue, which is being donated to several
charitable companies as chosen by the customers (Kolkowska, Nöu, Sjölinder, & Scandurra,
2017).

Identify the nature and degree of main stakeholders’ interests, and implications of Conflicting
interests.
It is important to comply with the business conditions that will include a sense of interest of
every stakeholder. Different stakeholder will have different access and role in the business.
On the one hand, shareholders expects to make huge profits so that they can get huge return
on investment. Whereas, employees demand better working conditions. potential investors
often see how potential investors see the evidence of company`s obligation to respond to the
social obligations such as environmental issues before committing huge profits to the
organisation. It is seen that customers expects reliable and accurate items. Stakeholder
conflicts appears and asks the need of the few stakeholder group compromises of other
stakeholders. An organisation often make choices among the expectation between the
stakeholders (Tutor2u, 2018).
For instance- the inexpensive supplier of goods can help the goods to keep the prices down
for the consumers, which must not come up with ethical expense for the product safety
spoiling the quality of the consumer. By the end, product may be cheaper and they are highly
associated with the unethical practices of the supplier and providing them with low quality
risks, which further damages the business reputation and its financial loss (Kolkowska, Nöu,
Sjölinder, & Scandurra, 2017). Some activities do not take any immediate effect of financial
gain on the investments in order to support the business`s corporate social responsibility.
Some policies, procedures, and values has to be communicated and elaborated to all the
stakeholders included so that they could understand the long-term value that they provide.
For example- companies often invest in green energies (solar power) that would be more
expensive but at the same time, it reduces the chance that would led to reduction in
environmental footprint. Further, supporting the employees may lead to trade-offs
(Kolkowska, Nöu, Sjölinder, & Scandurra, 2017).

Employees of RELX group has been offered by the development opportunities so that they
could reach the potential. The group has to justify the investment in against opportunity costs
by using the time and resources for various purposes. This will lead to assessing the potential
not giving training to the employees. This will lead to losing the vital people and old people
from the organisation and creating other mistakes happened because of lack of training
(Kolkowska, Nöu, Sjölinder, & Scandurra, 2017).
Create a stakeholder matrix
The level of main stakeholders’ influence has been determined by the stakeholder`s matrix.
These stakeholders exert pressure from outside the organisation. In the below chart, X-axis
determines the level of interest by each of the stakeholders such as in the first quarter, it is
seen that category “A” stakeholders such as distribution channels and recruiters impose
minimum effort to affect the decision making. “B” category stakeholders include customer,
supplier, employees, and the retailers (Ji, Li, North, & Liu, 2017). This category of
stakeholders impose certain power, as they need to inform before conducting the operations.
For instance- the company has to consider consumer perception and conduct advertisement
for them so that they can buy the products. Suppliers need to be informed earlier regarding
the raw materials, which it needs. Employees should be informed regarding the adoption of
decisions before it is taken. “C” category are the stakeholders that hold more than a certain
power as well as a level of interest to influence stakeholders (Kearns, Apollonio, & Glantz,
2017).

(Source: Kolkowska, Nöu, Sjölinder, & Scandurra, 2017)
While evaluating the community on the stakeholder`s map, it is seen that community is less
powerful with less interest. Amazon is accountable for its carbon footprint while considering
the material that is used and seen as disposed in packaging of goods and services as provided
to customers. With raising health conscious habits among the customers where the Amazon is
considering the severe impact of being obliged in regards to the environment, which is crucial
for profitability of the organisation (Ramus, & Vaccaro, 2017). Community exerts greater
pressure as a key stakeholder by considering the crucial situation. This makes the community
as the major stakeholder where it has greater power with high interest in regards to
responsible purchasing. There is an approach which enables Amazon`s CSR strategies in
satisfying interests of the societies as important stakeholder group on the online platform
(Walker, Lee, James, & Ho, 2018).
Employees are positioned as company`s culture and competitive compensation to support,
which are components of the company`s CSR strategies in order to address the interest
employee`s group. While determining Amazon`s CSR strategies, it is seen that Amazon has
placed customers on the highest priority and placed at most crucial stakeholder group

(García, Grima, & Benau, 2015). The organisation priorities customers as one of the most
important determinant of the e-commerce considering the business success (Schaltegger, &
Burritt, 2018). These priorities will significantly affect the revenues. Customers exert
pressure in such a way that Amazon agrees to focus on customer preferences and its
development. Customer’s interest lies more in fair pricing, service quality, convenient
services, and finally the online security while transacting in the organisation (Ramus, &
Vaccaro, 2017).
Employees such as senior technical and other employees in the emerging markets, it is seen
that these stakeholders exert pressure that lays down which 40 percent of the eligible
employees will ask for the retirement in nearly next four years and this will lead to generate
huge knowledge gaps between the existing employees and freshers (Pang, Shin, Lew, &
Walther, 2018). This will affect the ability of the company for the procedure of innovation
and launching of the new product. Employees in the developing market reveals that after
turning 25 years, the organisation will turn over leaving the job who are paid more and
promised to be paid more for the fasten advancements (Business case study, 2018).
Top-level management includes CEO (chief executive officer) will include the promising of
the certain actions that includes growth of new products for the next few years. At the same
time, theses business leaders find difficulty in tracing the needs and demands as per the
difficulty in retaining the local talents (Herremans, Nazari, & Mahmoudian, 2016). Investors
include top-level investors such as state pension fund managing actions, which claim reliable
returns with the reasonably performance that will assist to gain the ground. These pension
managers will be needed to bring out internal and intended IT line manager and HR manager
to align with the benchmark ratios, and P/E ratio which lags behind in the retail online
industry. There is a need to lag behind and find how it is important to leverage some
uniqueness in the organisational culture in order to create value (Men, & Tsai, 2015).

In today`s era, competitors are another exerting pressure stakeholders that reveals that 30
percent of the more revenue has been generated from the products that are introduced in the
last three years. There is a need to transform the HR as per the creation of correct
organisation in order to produce more creative and innovative models (Ruehl, & Ingenhoff,
2015). In future, the competitor will give and cutthroat competition will hinder the growth of
where the organisation needs competitive cutthroat staff to lead the market. Suppliers receipts
pressure in regards to order the bulk purchases and finally drive to the low costing forces that
will affect the company`s competitiveness (Manetti, & Bellucci, 2016). Government
regulators rate regarding the monopolies and help the HR group in an effective way. Security
commission will retain discipline, which is related for discipline in managing the US centre
(Kazadi, Lievens, & Mahr, 2016).
Customer driven approach and centric are some of the key elements, which will describe the
Amazon’s objectives (Ott, & Theunissen, 2015). From the very beginning, Jeff Bezos have
revealed that their most preferable stakeholder is the customers, which detracts and hinders
the improvement the progress update while satiating their wants are not considered by the
organisation. Stakeholders are most crucial part of the affecting groups among its folks
(Manetti, & Bellucci, 2016). Customers are those folks who has money. The competitors will
not be sending the money to operate its significance in company`s influence will be less than
the customers. in order to meet the customer`s expectations, Amazon will take steps to
become a market leader in serving its customers such as it offers the services continuously so
that it can expand its ventures and its networks of the company which were poles apart
(Manetti, & Bellucci, 2016). Some of the top target and other customer groups, it is seen that
OEMs will cover the costs and other higher inputs to derive performance and seeking
products to compete. Further, cheaper servers will lead to responding to the pressures to the
lower costs (Nieto et al., 2015).

Conclusion
From the above discussion, it can be said that internal and external stakeholders will affect
the business decisions. In order to analyse the level of interest and level of power accessed by
the stakeholders, it is seen that a stakeholder matrix has been used. This matrix has divided
the stakeholders with the help of categorisation “A, B, C, D.” These categories would reflect
the extent to which the organisation’s decisions are affected. The analysis that government,
customers, and shareholders exerts maximum pressure and they do not have much
contribution towards the internal operations. This discussion has an effective layout of
difference in stakeholders in two industry such as “online retail store” and “healthcare
sector.”

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