Discuss about The Current Leadership Strategy Of Amazon Company.
The current leadership environment is very competitive and coupled with many challenges that come with the organization management of business. Every organization hence has in place strategic goals and objectives that should be attained or achieved within a set time frame. The objectives may be smart, measurable, achievable, specific, and time-bound with a well-managed and qualified staff to help in achieving the set objectives for long-term success and productivity of the organization. However, the success of performance will greatly rely on the leadership strategy adopted or practiced by the organization. A good leadership strategy will help the organization to align their duties with the strategic goals of the organization depending on the professional development objectives. Effective leadership strategy will also motivate wise decision-making to help in linking the leadership styles with the strategic objectives of the organization (Connelly 2015, p. 482).
According to Huffaker (2010), leadership strategy is the act of adopting well-strategized and considered skills in the process of communicating or driving the vision of an organization. A leadership strategy primarily persuades and motivates the workforce for easy organizational management in a similarly shared vision of the organization. It is thus a vital tool that can create an essential structure for an organization so as to implement any effective and necessary changes within the organization so as to drive it towards the strategic objectives of the organization. Such changes may involve setting the leadership requirements for the organization together with their responsibilities in the journey of driving the organization towards the set goals and objectives. This paper examines the leadership strategy adopted by Amazon Company to enable the organization to achieve its set goals and objectives. The paper focuses on the business strategies adopted by the organization, implications of the strategy on the leadership requirements, and conclude by recommending a strategy that can improve the performance of the organization so as to enable it to attain its strategic goals.
According to Connelly et al. (2015), many organization struggles with knowing the best leadership strategy to adopt to effectively proceed to success and efficiency in achieving the set goals and objectives. As a result, a question that many managers ask themselves is that what are the elements of a good or well-developed leadership strategy that an organization should adopt? Gordon (2015) in his article also notes that the current business environment is very uncertain, and many employees are questioning how their jobs and the industry will be impacted owing to the ever increasing global economy. As a result, many organizations tend to be unsure of the best actions to take hence creating avoid negativity within the workplace. The void negativity tends to create fear and lack of positive communication that finally dominate the behavior, thoughts, and actions of the employees. Gordon further points out that such a situation leads to lack of trust, poor focus, uninspired teamwork, decreased productivity, and subpar performance. Instead, the workforce switches to the survival mood of survival (Walker, & Aritz 2015, p. 458).
The current business environment thus needs a well-developed leadership strategy with strategized basics that can motivate the leadership to have a plan of action that can encourage, empower, and inspire the workforce. Such a leadership strategy motivates a transfer of belief in the leadership of the organization that majorly determines the difference between failure and success. Positive leadership strategy tends to share the vision, optimism, belief, purpose, and organizational plan that finally empower the employees to act and execute what they believe. A well-developed leadership strategy thus leads to powerful plans and actions that will produce significant strategic results for an organization (Gordon, 2016). However, it is more than just having inspirational speeches because it is a process that requires several steps to drive the organization to the right direction. It hence involves the following elements;
Have a priority in the culture of the organization
Poor leadership style results to the negativity that tends to knock the employees off balance. A well-developed leadership strategy should refocus, regroup, and unit the employees to create a team environment and a winning organizational culture. With good working relationship and a winning team, Rashad (2015) point out that an organization creates an internal strength within the organization that can win and withstand the naysayers, negativity, and adversity from the external challenges. A well-developed leadership strategy should thus make the culture of the organization as the priority of every employee so as to it through a powerful and long-term success of the organization. A good leadership strategy hence needs to sell the culture of the organization to the employees so that they can by the vision and work towards it. It hence requires a clear understanding of the target customers, propositional values of the organization, competitive abilities, and weaknesses of the organization. Well-developed leadership strategies will hence promote core competencies and develop capabilities as well as the relevant skills that will enhance value promotion towards the strategic goals of the organization.
Share a positive vision
The vision of the organization should always be simple, bold, and clear for everyone to understand and work towards the strategic objectives set to meet the objectives. It must also be relevant to the challenges the organization must be facing and the way forward (Huffaker 2016, p. 600). A good and well-developed leadership strategy must share the vision so as to encourage the management and the subordinate to work towards the vision. It should work towards affecting the vision of the organization. Instead of focusing much on the initiatives and tasks of the organization, a well-developed leadership strategy promotes a deep industrial or professional knowledge towards the strategic goals and objectives of the organization. In their study, Connelly et al. (2015) point out that a strategic thinking towards the goals promotes a strong network with a consistent identification of the market trends to as to tune the organization performance towards the dynamics of the market that may affect the achievement of the strategic goals of the organization.
A well-developed leadership strategy needs to focus towards utilizing the current challenges, complaints, and problems as a way of generating new ideas, paths of success and innovations. According to Walker and Aritz (2015), History has it that many ideas and innovations of product initiatives for many successful companies were developed during downturns and recessions. As a result, in the case of challenges and downfalls, both the employees and the management should ask themselves what they will learn from the challenges, what opportunities does the challenges offer that can be utilized as a chance of improvement? What actions need to be taken towards the available opportunities? In the uncertain times of the competitive business nature, predicting the future can be difficult. It hence requires positive leadership, positive action, and positive communication that can create a stronger, better, and wiser future.
A well-developed leadership strategy also promotes unity and good relationship in the working place. It ensures employees develop their skills and strategies through training and development that not only benefits the employees but the organization as well. It should promote an outstanding self-awareness among the employees and the management. According to Johnston and Marshall (2016), every employee has a fault and instinctive behavior that can result in consequences. Understanding the weaknesses and strengths of the workforce through healthy discussions and debates that can be helpful to promote the improvement of the weaknesses and strengthen the workforce. The strategy should also be persuasive and inspirational so as to unite the workforce towards achieving the strategic goals of the organization according to Ripoll (2015, p. 445).
Amazon is an American multinational company that offers various types of online products. The company is based in the United States of America specifically at Seattle in Washington. Even though the company started as a bookshop, the development of the technological innovations has enabled Amazon to diversify its products over time continually. The primary strategic goal of this American multinational organization is to offer a one-stop online shopping experience for its customers, where they can access all the company products (Simchi-Levi et al., 2014). The company operates as a pure internet retailer that do not have any physical retail store. With the adoption of technological innovations and models into its operations, all the products of the company are supplied and delivered to its esteemed customers through its networks of distribution centers. This strategy or form of business operation enables the organization to offer diverse and high-quality products at relatively low prices. Also, it facilitates customer satisfaction since it promotes customer convenience (Pearce, Robinson & Subramanian 2011, p. 67). As a result, the online retail chain system has helped in reducing the cost of operation while it offers its products at affordable prices.
The strategy of the online offerings has enabled Amazon to keep a low price in its products thus passing the benefits to the consumers. Their robust customers centric approaches of analyzing the buying behavior of the customers based on their preferences have enabled them achieve a competitive edge over their stiff competitors. Simchi-Levi et al. (2014) denote that Amazon has become one of the longest players till date in the online sector with a solid customer hold and market share in the US and European countries, an advantage that is helping the company to expand is new markets despite the competitive dynamics of the online business. In his study, Bhasin (2016) denotes that e-commerce companies such as Amazon using demographic and psychographic segmentation for the market segmentation research and analysis. The company has thus developed a leadership strategy that ensures the business works towards the actual purchase behavior of customers. It thus focuses on what people have actually expressed interest in and not what they might.
In the marketing mix, Amazon acquired different IT and e-commerce start-ups so as to differentiate itself from its competitors. These included pets.com, Junglee.com audible.com, Woot, IMBD.com, and Zappos.com that enabled the firm to provide high value to their customers by the use of the existing technology from the partners at subsidized cost. As a result, it has achieved economies of scale by offering extensive products such as games and toys, electronics, DIY, and apparels, among others. The strategy narrows down into targeting the individual customers hence converting visitors into high-value and long-term customers. According to Imran (2015), customer segmentation is often involved in creating personas who buys certain products in certain ways. In the same way, Amazon targets the both the middle and upper-class customers with hands-on experience in the primary technological basics but have no time of preferring online convenience over physical outlet shopping. The strategy has thus promoted the firm positioning it in the Go Global Act local (Glocal) e-commerce giant offering stiff competition with other online platforms such as Google. As a result, any customer can purchase any product and still get the product delivered at any remote location of their choices.
On effective leadership requirements, the business strategy adopted by the company has shown competency, vision, unity and value not only to the organization but to the customers as well. The leadership strategies adopted by the management of the organization has seen it through achievements with a good customer base in the global market. However, to maintain its position in performance, Amazon need to develop a leadership strategy that will help the organization keep an open culture and maintain its investors, developers, and customers united in an open communication of innovation and development of not only the products but the workforce as well. As a result, a development-centered leadership strategy is as well essential to enable it develop a workforce that is diverse and qualified to face the market challenges.
Critical competencies of the strategy
Sourcing qualified leaders and employees: The strategy will ensure a bought mix to balance the ratio between the external hires and the internal hires in the management at a ratio of 3:7. This will mainly be done so as to challenge the culture of the organization and encourage new ideas while providing development opportunities for the internal development of the organization. The leadership strategy will as well adopt a succession planning process as an exclusive method of placing the qualified leaders into their respective positions. The organization will thus be able to identify qualified candidates and match them with the relevant positions and opportunities. The process will be conducted through a succession planning process using the competencies of the candidates as the primary screen of monitoring qualifications. According to Gandossy and Effron (2016) succession or retention of leaders in the respective new roles of the organization both internally and externally requires a process which provides coaching and guidance. On-boarding leaders will be adopted as a process of examining working relationship building as well as the personal performance of the leaders that will be relevant towards the strategic objectives of the organization.
Leaders’ Alignment: Using the strategy, Amazon will align its leaders on three major concepts which include performance management, executive coaching, and leader engagement. Through performance management, the organization will be able to set aggressive goals for all the leaders in the various departments of the organization. The process will thus ensure that stretch goals and objectives are key components necessary for balancing business performance measurements to promote positive individual behaviors. Engagement of leaders will as well be monitored actively through annual surveys of the human resources by an executive team that will be jointly held accountable for the identification and improvement of deficiencies within the organization. The strategy will as well ensure that an executive coaching process is adopted to develop the performance of the workforce and will be adopted as a core aspect of the strategy.
Developing leaders: The process will be carried out through assignment-based development, executive development, and high-potential development. On the assignment-based, job assignments and responsibilities will be the primary strategy for developing leaders so as to help in matching the employees with their responsibilities as per the flow of the succession planning process. High-potential development will ensure that the highest-potential employees of Amazon receive a disproportionate share of the organizational developmental resources such as the shares. The strategy will thus plan on the development of the group activities for the potential leaders among the staff then increase their exposure to the board and the senior team while reviewing their performance periodically like on a semi-annual basis. On the other hand, the executive development process will provide group-based sessions for the leaders to develop skills of customer service and clear vision communication and acumen.
Rewarding leaders: Amazon Company should adopt different ways of rewarding their leaders such as having base pay, long-term incentives, as well as the annual incentives. The strategy will ensure a set of a 50th percentile as the major target for the base pay with high-potential employees identified through different successions process that will be paid at the 60th percentile. The strategy will as well adopt an annual incentive with a 75th percentile target that strongly differs between median and high performers in distribution of rewards. However, the long-term incentive will adopt a combination of regular stock option and performance-vesting stock to provide the necessary incentives for consistent leader behavior. The process will thus target the 75th percentile for the awards while differentiating between median and high performers.
Adopting this strategy will help the organization in many ways while pushing the organization towards its strategic goals. It will also ensure that different essential programs within the workplace are monitored such as training and development of employees, resource sustainability, good relationship in a working environment etc. It will lead to great investment and produce good returns that will fuel the developmental strategies and speed the launch of new products. According to Rashad (2015) a development leadership strategy should focus not only on the strategic objectives of the organization but on the training and development of workforce as well since they are the major driving force for the success of every organization. The strategy will as well help the firm in figuring out how to address any human resource challenge and maintains a productive workforce full of fun, skills, and diverse knowledge for a productive atmosphere.
Conclusion
Well-defined leadership strategies play major roles in the successful performance of an organization as every organization is created with a purpose to achieve particular objectives. As a result, effective leadership strategies are essential in ensuring the organization coordinates its activities so as to achieve the set strategic goals and objectives. Good leadership is hence the backbone to the success of any organization as the performance of the workforce is solely dependent on direction and motivation from the leadership. Therefore, there are different types of leadership strategies that can be experienced in a workplace or adopted in an organization each of which has its advantages and disadvantages. The types of leadership styles adopted are dependent on the goals and culture of the organization as well as the task to be completed.
List of References
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Gandossy, R, & Effron, M, (2016), Leading the way, John Wiley & Sons publishers, Retrieved from https://www.workforce.com/2004/03/01/a-sample-leadership-strategy/
Gordon, J, (2015), 5 Positive leadership strategies: Developing positive leaders, teams and organization, Retrieved from https://www.jongordon.com/blog/5-positive-leadership-strategies/
Huffaker, D 2010, ‘Dimensions of Leadership and Social Influence in Online Communities’, Human Communication Research, 36, 4, pp. 593-617, Communication & Mass Media Complete, EBSCOhost, viewed 24 September 2016.
Imran, A, I, (2015), A study on Amazon: information systems, business strategies and e-crm, Retrieved from https://www.researchgate.net/publication/261440748_A_STUDY_ON_AMAZON_INFORMATION_SYSTEMS_BUSINESS_STRATEGIES_AND_e-CRM
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Ripoll, P, 2015, ‘The moderator role of followers’ personality traits in the relations between leadership styles, two types of task performance and work result satisfaction’, European Journal Of Work & Organizational Psychology, 24, 3, pp. 444-461
Simchi-Levi, D, Kaminsky, P, & Simchi-Levi, E, 2014, Managing the supply chain: the definitive guide for the business professional. McGraw Publishers.
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