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Amazon’s Organizational Chart and Its Changes to Facilitate Customer Management

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Amazon’s Organizational Chart and Its Changes to Facilitate Customer Management

The organizational structure of Amazon is characterized by a hierarchical and

departmentalized approach, wherein the CEO, Jeff Bezos, occupies the highest position.

Subsequently, senior executives, vice presidents, directors, and managers follow in descending

order of authority. The company’s main business units are divided into two broad categories: the

retail business and Amazon Web Services (AWS). The retail business is further divided into

various departments, including Amazon Prime, Marketplace, and Prime Video. Each department

has its own senior vice president, vice presidents, directors, and managers.

Amazon would need to restructure its organizational chart to be customer-centric to

facilitate customer management. The company would need to create a separate department for

customer relationship management (CRM), with a senior vice president responsible for

managing the relationship with each customer. Peppers and Rogers (2017) assert that achieving

success necessitates the complete reengineering of organizational processes to prioritize the

customer. The role of the customer relationship manager entails the retention and expansion of

customers who are profitable, the conversion of those unprofitable, and the selective acquisition

of prospective ones based on their potential to become high-value customers. The CRM system

would possess the capability to modify the enterprise's approach towards individual customers.

In order to prioritize customer experience, Amazon must modify its organizational

structure to become more adaptable and less hierarchical. The company would need to eliminate

the layers of management that create bureaucratic red tape and slow decision-making. The

customer relationship manager would be empowered to make decisions and take action without

having to go through layers of approval. The CRM system would be bolstered by a team of

experts in customer experience, tasked with enhancing customer satisfaction by tailoring the
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assortment of products, pricing, services, and channels of communication to the unique needs of

each of them. The encompassing scope of customer experience involves the various channels

including apparent and inanimate components that constitute such experiences. The main aim is

to ensure reliable fulfillment of the customer promise that is aligned with the brand, and the

subsequent consumer desires through the physical encounter, as stated by Peppers and Rogers

(2017).

Amazon would have to set up a framework of standards that assesses the importance and

worth of customers. The customer relationship manager would be evaluated based on the success

of the customer base, measured by metrics such as customer retention rate, customer satisfaction

score, customer lifetime value, and customer acquisition cost (Peppers & Rogers, 2017). The

CRM would be compensated based on the success of the customer base, with incentives tied to

metrics such as revenue growth, profitability, and customer loyalty. The customer experience

specialists would be evaluated and compensated based on the success of the customer

experience, measured by different metrics.

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References

Rogers, M., & Peppers, D. (2017). Managing customer experience and relationships: a strategic

framework. John Wiley & Sons.