Corporate Strategy Analysis Report: Business Strategy at Amazon

This report provides a detailed analysis of Amazon's corporate strategy, examining various aspects of its business operations. The analysis begins with an assessment of Amazon's competitive environment using Porter's Five Forces model and its generic strategy, identifying cost leadership as a key approach. The report also incorporates a BCG Matrix analysis to evaluate Amazon's product portfolio, categorizing products as cash cows, stars, question marks, and dogs. Furthermore, it assesses the role of knowledge, skills, and abilities (KSA) in supporting Amazon's global strategies. The report then delves into the ethical implications of Amazon's operations, highlighting issues such as tax avoidance, worker exploitation, and working conditions. The supply chain management is examined using the SCOR model, and the impact of global supply chains on Amazon's success is assessed. The report also identifies factors affecting Amazon's global supply chain and its marketing strategy. The report also includes an evaluation of the ways of applying corporate strategies across firms, the integration of corporate strategy in the organization and discussion of influence of corporate strategy on organizational functions. Finally, the report concludes with an evaluation of personal skills against skill sets required to operate effectively in the market.

Running head: CORPORATE STRATEGY ANALYSIS
CORPORATE STRATEGY ANALYSIS
Name of the Student
Name of the University
Author Note

1CORPORATE STRATEGY ANALYSIS
Table of Contents
Task 1.............................................................................................................................2
AC 1.1 Critical analysis of strategies theories and models........................................2
AC 1.2 Assessment of different successful strategies based on application in global
marketplace............................................................................................................................4
AC 1.3 Assessment of impact of individual, organizational and global ethics on
corporate strategy...................................................................................................................4
Task 2.............................................................................................................................6
AC 2.1 Critical analysis of the supply chain methods, theories and models.............6
AC 2.2 Critical assessment of the role of global supply chain in organizations........6
AC 2.3 Identification of factors that affect global supply chain................................7
Task 3.............................................................................................................................8
AC 3.1 Evaluation of the ways of applying corporate strategies across the firms.....8
AC 3.2 Assessment of the integration of corporate strategy in organization.............9
AC 3.3 Discussion of influence of corporate strategy on organizational functions.10
Task 4...........................................................................................................................10
AC 4.1 Evaluation of personal skills against skill set required to operate effectively
in the market.........................................................................................................................10
AC 4.2 Understanding and making using of theory to enable learner to develop
individual skills....................................................................................................................11
AC 4.3 Providing personal examples based on demonstration of professional skills
..............................................................................................................................................12
AC 4.4 Communicating effectively with the professionals.....................................12
References....................................................................................................................13

2CORPORATE STRATEGY ANALYSIS
Task 1
AC 1.1 Critical analysis of strategies theories and models
Analysis of Porter’s five forces model of Amazon.com – This model had been
developed by Michael E. Porter in order to help the organizations to analyse the levels of
competitiveness of the industries and form the corporate strategies accordingly. The business
is also able to understand the ways by which major forces can determine the profitability
levels in the industry. Amazon.com Inc. can also implement this model in order to analyse the
competitiveness of retail industry (Aguinis, Edwards and Bradley 2017).
Competitive rivalry – The levels of aggressiveness of the firms in retail market is able
to enhance the competitive rivalry faced by Amazon.com. The substitutes of products offered
by Amazon are also readily available due to presence of major competitors (Amazon.com
2019).
Bargaining power of the consumers – The consumers are considered to be the most
significant force that has an impact on the profitability levels of Amazon.com. Consumers are
able to influence the product portfolio and prices of products in the industry (Baumgartner
and Rauter 2017).
Bargaining power of the suppliers – Amazon.com has been successful in growth of
an efficient supply chain with the help of its suppliers and distributors. However, the
importance of suppliers in the e-commerce industry are high and they have the power to
influence the prices of various products.
Threats of the substitutes – The low switching costs in retail industry and huge
presence of the substitute products has been able to influence the revenues and position of

3CORPORATE STRATEGY ANALYSIS
Amazon as well. Physical retailers are also able to provide threats based on substitute
products to Amazon (Broman and Robèrt 2017).
Threats of new entrants – The entry of new firms in the retail industry is considered
to be a weak force due to the requirement of huge investments for the purpose of gaining
effective profits. The brand development based costs are also considered to be quite high in
the industry due to which Amazon is not affected by this force (Cândido and Santos 2015).
Porter’s generic strategy of Amazon – This strategy is mainly based on the methods
by which a firm aims at gaining competitive benefit in the industry in comparison to the other
firms. The generic approach that is applied by Amazon in order to uphold its competitive is
termed as the cost leadership approach. The company aims at minimization of the production
costs that further reduces the prices of products (Busse et al. 2016).
BCG Matrix analysis of Amazon.com Inc. – This framework can be used by a global
organization like Amazon in order to analyse the various products that are a part of the
product portfolio.
Cash Cows – The products of Amazon.com that can be considered as cash cows
include the e-books and the Kindle. These products have been able to produce high levels of
revenues for the firm and have increased its shares in the market as well (Engert, Rauter and
Baumgartner 2016).
Stars – The products that are a part of this category of BCG matrix are electronic
appliances which are high in demand and are emerging as leading generators of revenues.
Question marks – The segment of services of Amazon that offer video on demand
based services have limited shares in the market. These products also have fewer chances of
growing into profitable units (Frow et al. 2015).

4CORPORATE STRATEGY ANALYSIS
Dogs – The Amazon mp3 business is not considered a profitable part of the operations
that have been developed by the company. The market share and revenues that are gained by
Amazon with the help of these products are also quite low (Frynas and Mellahi 2015).
AC 1.2 Assessment of different successful strategies based on application in global
marketplace
KSA or knowledge, skills and abilities are able to play a key part in the methods by
which a major company like Amazon can maintain its place and revenues in the industry as
well. The strategies that are developed by the company for the purpose of maintaining the
operations in various countries are developed in an effective way with the support that is
provided by the knowledge, skills and abilities of the employees (Garcia and You 2015). The
employees or human resources of firm are considered to be a major resource that has
supported the growth of Amazon in a huge manner. The KSA framework has been applied by
the company in order to use the skills and abilities of the employees for proper
accomplishment of the overall organizational goals (Guest 2017).
AC 1.3 Assessment of impact of individual, organizational and global ethics on
corporate strategy
Amazon.com has been offering its products to the customers at low prices and has
proved to be highly useful and valuable for the consumers. However, the operations of the
firm and strategies that have been implemented led to the formation of many ethical issues
that it has faced in the retail industry. The ethical issues that have been faced by Amazon in
its operations in the retail industry have an impact on the proper implementation of the
corporate strategy (Helfat and Martin 2015). The major ethical issues raised in the operations
of Amazon are as follows,

5CORPORATE STRATEGY ANALYSIS
Tax avoidance is a major concern that has been faced by Amazon. The
avoidance of taxes has been quite important for increasing the revenues that
have been gained by the firm in the industry.
The wages that are provided by Amazon to the workers in the warehouses are
quite low in comparison to the actual industry standards (Hitt, Ireland and
Hoskisson 2016).
The temporary workers in warehouses of Amazon have been exploited by the
firm in a huge manner. The compensation provided for their services are low.
The environment that has been formed by Amazon in the organization is
considered to be quite toxic in nature. The pressure that has been created by
the firm on the employees has led to the development of a negative work
environment where motivation levels are quite low (Hsu, Tan and Mohamad
Zailani 2016).
The delivery drivers of Amazon who are used by the company to deliver the
orders to customers are not compensated by the algorithm in an effective way.
The employees who are a part of the delivery system are thereby not able to
make a living with the help of incomes that are generated by the delivery
based operations of Amazon in online retail market (Kim and Chai 2017).
Task 2
AC 2.1 Critical analysis of the supply chain methods, theories and models
The supply chain processes reference or SCOR model is considered to be a major
management based tool that is implemented for addressing, improving and communicating
the decisions related to proper supply chain management. The business processes that are
used for the purpose of satisfying demands of customers are described in the model in detail.

6CORPORATE STRATEGY ANALYSIS
The SCOR model is considered to be highly effective for development of strategic decisions
of the firms. Different steps that are a part of the model include planning, sourcing, delivering
and returning (Kirchoff, Tate and Mollenkopf 2016). Amazon has implemented SCOR model
in order to develop the approaches that can be applied in different stages of strategic decision
making process. The efficient supply chain of Amazon.com has been formed with the help of
proper implementation of the SCOR model. The corporate strategies and various business
strategies are developed with respect to different steps that are a part of the SCOR model
(Nylén and Holmström 2015).
AC 2.2 Critical assessment of the role of global supply chain in organizations
The bold supply chain based approaches that have been applied by Amazon.com are
able to change the face of the retail industry. The use of innovative technologies in
development of supply chain has been able to support the firm in facing competition in the
market. The annual revenues gained by Amazon.com had increased from 7 Billion Dollars to
136 Billion Dollars within the years 2004 to 2016. The efficiency of supply chain of Amazon
has been able to play a key part in ensuring the methods by which the firm has been able to
enhance its services and has also increased the revenues (Pearlson, Saunders and Galletta
2016).
The game changing delivery strategy applied by Amazon.com has also been able to
improve its reach towards the customers. The Amazon Prime service has played a key part in
the methods by which the firm has aimed at improving the efficiency of its operations and
provide better services to the customers. The supply chain strategy of Amazon.com has also
played a major role in enhancing the revenues that have been earned by the company. The
supply chain of Amazon.com is highly dependent on the proper outsourcing of the inventory
management process of the firm. Third party based logistics have an impact on the

7CORPORATE STRATEGY ANALYSIS
approaches that have been applied by Amazon.com for the development of its supply chain in
an efficient manner (Prajogo 2016).
AC 2.3 Identification of factors that affect global supply chain
The global supply chain that has been developed by Amazon is influenced in a huge
manner by the third-party based suppliers of logistics related needs of the company. The
deliveries options that are being provided by Amazon have are based on the needs of the
consumers and this helps the company to fulfil their needs in an effective manner. The
company has also maintained different warehouses for products with respect to the deliveries
options that are selected by the customers (Taticchi et al. 2015). The efforts that have been
applied by Amazon to improve the delivery speed of the products have been able to play a
key part in providing the company with a leadership place in the industry. The warehouses of
the company have also been placed in a strategic manner and they are closer to the city
centres and the metropolitan areas as well. The fulfilment centres of Amazon that are located
in different parts of the US have been able to enhance the operating speeds. The success of
supply chains of the firm is based on the size, location and number of warehouses that are
located in diverse parts of the world (Trkman, Budler and Groznik 2015).
Task 3
AC 3.1 Evaluation of the ways of applying corporate strategies across the firms
Marketing strategy of Amazon.com –
The marketing approach that has been developed and implemented by Amazon.com is
mainly related to the four Ps. This is considered to be a major tool that is used by the firm in
order to attract the consumers towards the website of Amazon. The company aims at reaching
out to its target market with the support that is provided by the development of an effective
marketing strategy (Wolf and Floyd 2017). The four Ps of marketing mix are as follows,

8CORPORATE STRATEGY ANALYSIS
Product – Amazon.com has been able to enhance the product base that is offered to
the customers with the help of effective expansion of its operations. The variety of products
that are offered to the customers include retail services, retail goods, consumer electronics,
Amazon Prime, distribution service of digital content, Amazon Video, Amazon Publishing,
Amazon Web Services or AWS, Amazon Fresh, Amazon Prime Pantry, Amazon Dash.
Place – The website of Amazon is considered to be the most important distribution
channel that is used by the firm to reach the customers. The company has also started opening
its physical stores in order to face the competition that is provided by the physical retail based
firms (Trkman, Budler and Groznik 2015).
Promotion – The promotional activities that have been developed by Amazon.com
are considered to be highly significant for the firm in order to create its place in the minds of
consumers. The communication that is developed by the company with its target market is
also considered to be a major factor that is related to the promotional activities of the firm.
Different promotional methods that have been applied by Amazon.com include advertising,
public relations, sales promotions and direct marketing (Prajogo 2016).
Price – The pricing strategy used by Amazon is considered to be the most important
feature related to the processes that have been developed by the firm. The market-oriented
pricing strategy has been applied by Amazon in order to decide the prices that will be charged
for the products. This has helped the company to remain competitive in the retail industry for
a long period of time (Frynas and Mellahi 2015).
Human resource management in Amazon -
The employees or human resources of Amazon.com have been maintained by the
CEO or leader of the firm Jeff Bezos. The CEO has developed a vision for the employees

9CORPORATE STRATEGY ANALYSIS
based on the customer oriented operations. Jeff Bezos has created pressure on employees so
that they can satisfy the customers by fulfilling their needs within least amounts of time. The
methods that have been developed and applied by the firm have always been based on the
“customer first” based concept of Amazon. The organization has also been able to sustain its
position in the highly competitive industry with the proper levels of support that is offered by
the diverse and highly talented groups of employees (Sparrow, Brewster and Chung 2016).
AC 3.2 Assessment of the integration of corporate strategy in organization
Corporate strategy of Amazon.com - The generic corporate strategy developed by
Amazon.com has been described as the concentric diversification. The corporate strategy is
mainly based on the methods by which the firm is able to leverage the technological
capabilities that are important for success of the business. Corporate strategy of Amazon is
thereby based on the cost leadership strategy that has been applied by the firm in deciding the
prices of various products (Brewster et al. 2016). The different organizational functions that
will be influenced by this strategy include global function based groups, global hierarchy and
geographical divisions.
Business strategy of Amazon.com - The business approach that is developed by the
firm has paid off and Amazon.com has been successful in sustaining growth of the firm as
well. The proper integration of the corporate strategy of Amazon in the business operations
has been able to play a crucial part in the improvement of growth levels. The increase in
levels of profitability has been influenced in a huge way by the corporate strategy of Amazon.
The measures that have been taken by Amazon in order to uphold the strategy include the
discounts that are provided to the Prime members and ensuring the delivery times of various
products as well (Collings, Wood and Szamosi 2018). The business strategy implemented by
the company are implemented in the different geographical divisions, global function based
groups and global hierarchies as well.

10CORPORATE STRATEGY ANALYSIS
AC 3.3 Discussion of influence of corporate strategy on organizational functions
The corporate strategy that is implemented by Amazon.com is termed as concentric
diversification and this has a major impact on different functions of the organization. The
organizational structure of Amazon is mainly based on the functional groups that are
influenced by the corporate strategy in the following way,
Global function-based groups – The global function based groups are considered to be
a major characteristic of the organizational structure of Amazon. The corporate strategy of
concentric diversification is able to influence the e-commerce based processes. Different
functional groups have the responsibility to fulfil their duties that can lead to implementation
of corporate strategy (Broman and Robèrt 2017).
Global hierarchy – The organizational functions are fulfilled by employees of
Amazon at different stages of the hierarchy that is formed on a global basis. The corporate
strategy can influence the role that is played by different departments
Geographic divisions – The division of functions in Amazon are also based on the
geographic regions in which the business operates. The functions and objectives for the
employees in different areas are set with respect to the corporate strategy of diversification
(Cândido and Santos 2015).
Task 4
AC 4.1 Evaluation of personal skills against skill set required to operate effectively in
the market
The skills that have been gained by employees of an organization have a major
influence on the processes and customer base that is developed by the firm. The comparison
of my personal skills with the required skill sets of the employees of Amazon will be able to

11CORPORATE STRATEGY ANALYSIS
help in development of an understanding of the entire matter (Aguinis, Edwards and Bradley
2017).
Personal skills Required skills
I have good skills of communication. Good communication with customers.
I am able to work in a diverse environment. Diversity management skills.
I have issues in working under pressure. Pressure handling skills.
I am a good team player. Development of proper teamwork.
AC 4.2 Understanding and making using of theory to enable learner to develop
individual skills
The Herzberg’s motivation theory can be applied by Amazon in order to develop the
skill sets that can be used in the organizational processes. The learners in the organization are
able to play a key part in the methods by which different objectives can be fulfilled within
stipulated amount of time. The model is also known as two-factor theory of motivation. The
factors that are a part of the analysis made in the model include the hygiene factors and the
motivation factors (Guest 2017). The hygiene factors of the model include company policies,
pay, physical working conditions, fringe benefits, interpersonal relationships, status.
Motivational factors include sense of the achievement, recognition, promotional opportunities
and growth, meaningfulness of work and responsibility. The increase in hygiene factors is
considered to be negative for the organization and the enhancement in motivation factors is
positive for the organization and the employees as well (Brewster et al. 2016).
AC 4.3 Providing personal examples based on demonstration of professional skills
I have been able to demonstrate my professional skills as a part of the work process
that is developed as a part of the organizational operations. The communications skills that