Case Study 3: The Amazon of Innovation

3.4: Amazon's generic strategy is cost leadership in broad market segmentation.

3.5: The best customer service is if the customer doesn't need to call you, doesn't need to talk
to you. It just works.

3.6:
Innovation is possible in a company where the employees don’t need to be told what to do
next. They are proactive and are well aware of the processes.

As a boss to that employee my initial reaction would be to try to know if the employee is facing
any problem in understanding the organizational culture and its processes. Then I will explain to
her clearly what is expected of her in terms of job responsibilities and output. Also, I will
provide her with all the support she needs in doing her job.

In an organization, in order to thrive the person should have qualities of taking initiatives,
proactive, should have sound knowledge of core area, open to the teammates and should have
good communication skills.

3-7:
Based on our opinions, to thrive at an organization like Amazon, one needs a combination of
technical, analytical, and soft skills.
- Technical Proficiency: Skills in data analysis, software development, and cloud services
(AWS), plus familiarity with Python, R, and SQL.
- Problem-Solving: Critical and creative problem-solving abilities.
- Adaptability: Flexibility and quick learning in a fast-paced environment.
- Customer Focus: Commitment to understanding and exceeding customer needs.
- Project Management: Ability to manage multiple projects, prioritize tasks, and
coordinate effectively.
- Communication: Clear and effective communication skills.
- Work Ethic and Resilience: Strong work ethic and resilience to thrive under pressure.

3-8:
UPS and FedEx should consider the following strategies in response to Amazon’s interest in
drone delivery:
- Invest in Technology: Develop their own drone systems and innovative logistics solutions.
- Enhance Existing Services: Improve delivery efficiency and optimize supply chain and
last-mile processes.
- Form Partnerships: Collaborate with tech companies or even Amazon where beneficial.
- Engage in Regulatory Advocacy: Influence drone delivery regulations to protect their
interests.
 - Diversify Services: Offer enhanced logistics, warehouse management, and fulfillment
services.
- Improve Customer Experience: Provide reliable, fast, and flexible delivery options with
excellent customer service.

3-9:
Advantages:
- Increased Reach: Expands market reach through Amazon’s vast customer base.
- Infrastructure and Logistics: Utilizes Amazon’s advanced logistics, reducing the need for
retailers' infrastructure.
- Brand Exposure: Enhances brand visibility and credibility by associating with Amazon.
- Customer Insights: Gains valuable insights into customer behavior and preferences.

Disadvantages:
- Competition: Faces intense competition from other sellers, including Amazon’s products.
- Fees and Costs: Incur various fees that reduce profit margins.
- Dependence: Risks associated with reliance on Amazon for sales.
- Brand Dilution: Potential for brand dilution as customers may associate purchases more
with Amazon.

Recommendation:
Retailers should evaluate their specific circumstances. Selling on Amazon is beneficial for rapid
online expansion and leveraging logistics capabilities but requires careful consideration of costs
and competition. A balanced approach, using Amazon alongside other sales channels, is
advisable to strengthen overall online presence and customer relationships.

3-10:
Not needed:
- Inventory management: can manages the inventory stored in warehouses.
- Customer services: provides customer service for orders processed through FBA.
- Returns processing: can handles returns and fixes errors.
Cost saved:
- Labor cost: savings on hiring staff for inventory management, or customer services.
- Storage cost: warehouse space can reduce the need for storage facilites

3-11:
Not need:
- Inventory management system: amazon has manage the inventory
- Order processing system: amazon has manage orders processing
- Returns system: amazon has manage returns processing
Cost needed:
- Software cost: savings on developing or purchasing systems
- IT staff cost: fewer IT staff to manage and support systems
3-12:
- Amazon marketplace web service (MWS): retailers can use MWS to integrate their
system with amazon
- Order management: retailers can see real-time of order data in amazon
- Reports: access various reports related to sales, inventories,…
- Product lists: retailers can upload product details to amazon