Essay: Analysis Of Amazon Australia Business." (46 Characters)

Overall analysis of the Amazon Australia Business

Organizations over the world deal with large amounts of data and it data are the facts and the basic values that are organized in to a database. It is considered that information is similar to data while, information includes the information which is required to solve problems and answer questions (Stonebraker et al. 2013). Thus, an information can be described as a software that helps in the organization and analysis of data. The main purpose of the information system is to transform the raw data in to information that can be used for decision making within an organization. Database Management System (DBMS) is an example of general purpose information system which is a combination of the data and the software, and it helps in analysis and organization of data (Gouhar 2017). While there are specialized information systems that are designed to specifically to work on a particular process within an organizational setting or even used to carry out a specific analysis. Enterprise resource planning is an information system which is used to manage both the external and the internal information of an entire organization. The components of the information systems are procedures, network, database, software and hardware. A human activity system can be described as notional system the emphasises on the human activity (Laudon and Laudon 2015). The systems are considered to be notions because they are intellectual constructs and are not real world activities. The human activity systems are at the three levels: 1) the system serves the environment of the larger system within which it is embedded; 2) the system serves the purpose of its members; 3) a system which the serves the main purpose of its collective entity (Eaasos.info 2018). This study is based on suggesting an information system solution for the Amazon Australia from the perspective of a trainee business analyst.

Amazon first arrived in Australia on 4^th December 2017 and compared to other retailers, the prices of the products were not cheaper. On the very first day of launch, the prices of the various products that were offered on the Amazon website are: FIFA 18 (PlayStation 4) video game for 40 dollars, Nintendo switch console for 399 dollars. While it was also seen that the Amazon Australia also did not launched the Amazon prime services on the very first day of its launch. It was though that the arrival of Amazon in Australia will shake up the Australian retail industry and it will put price pressure on the retail chains and the departmental stores. It was said by several market analysts that the American retailer giant will be unable to offer products at the cheaper rates while it can provide few products at discounted rates. This will force the Australian retailers to innovate strategies to keep the customers loyal (news.com.au, 2018). Amazon Australia has currently spent around 2 billion dollars per month on the online shopping. Considering from the online retailing, Amazon Australia has a share of 7.3 percent and it is major share. The business strategy employed by Amazon Australia includes wide range of products, marketplace for local business, free shipping benefits, and lower price of the products (webalive.com.au 2018).

Organizational form of Amazon Australia

According to Mintzberg’s classification, Amazon’s organizational structure can be described as a professional bureaucracy. Which has an operating core as its vital part and employs both the horizontal and the vertical decentralization. The organization is considered to be formalized but facilitates the decentralization so that the professionals are autonomous (Lunenburg 2012). The organizational structure of Amazon is hierarchical and consists of the senior management team of the one worldwide controller, three vice presidents, and two CEOs. There are 7 other departments that include the head of the segments, legal operations, human resources and information technology that report to the Amazon CEO along with the management team (Panmore Institute 2018).

According to Porter’s Value Chain Model consists of the 5 primary activities: inbound logistics, operations, outbound logistics, marketing and sales, and service. All the support activities are mentioned in the vertical column and it mentions all the primary activities. The support activities include the firm infrastructure, technology development, human resources, and procurement (Koc and Bozdag 2017).

According to the porter’s five forces analysis model, the five forces are as follows:

• Competitive competition or competitive rivalry (high force)- Amazon competes in a competitive environment and the rivalry exists within the online retail industry which includes the low switching costs (high force), high probability of the substitutes (high force), and aggressive nature of the firms (high force) (Panmore Institute 2018).
• Bargaining power of the customers or the buyers (high force)- Amazon follows an approach emphasising on the customers. Thus, the external factors that affect Amazon are: substitutes availability at high proportions (high force), low switching costs (high force), information of high quality (high force)
• Bargaining power of the suppliers (medium force)- in the e-commerce business, the suppliers here control the supply and the availability of the materials and supplies. The bargaining power of the suppliers are entirely based on the moderate suppliers (medium force), medium forward integration (medium force), small supplier size (high force) (Panmore Institute 2018).
• Substitution or threat of the substitutes (high force)- Amazon with the other market competitors in the field of online retailing. The external factors that are upon whom the intensity of substitution depends are: cost of the substitutes is low (high force), substitute availability (high force), switching costs is low (high force).
• New entry or threat from the new entrants (low force)- when new firms emerge, they potentially reduce the share of Amazon in the online market. Amazon experiences a less intensity of the threat and this includes: costs of switching is low (high force), cost of brand development is high (low force), scale of the weak economies (low force) (Panmore Institute 2018).

The several issues that were identified within the existing human activity system are: removal of the competitor’s products, amazon reviews, removal of the kindle content, selling of the Wikipedia materials in the form of books, selling of Nazi T-shirts, treatment of the worker in Amazon’s warehouse, E-book pricing, selling of books that denies the holocaust, blocking the pre-orders on the Disney movies (Forbes.com 2018).

The stakeholders involved within this human activity system are the retailers, products of the market competitors, book writers, consumers, amazon employees. Here, the amazon employees in the warehouse complained about being humiliated by the supervisors, the consumers complained of receiving books that are mere copy of the Wikipedia content, the book writers are found to be writing book reviews on their own books in the reviews section, amazon itself removed products that are similar to the products of the other market competitors.

This updated model consists of the 6 critical dimension like net system benefits, user satisfaction, system use or usage instruction, service quality, system quality, information quality. Considering the six areas, the areas where the human activity system is not successful are the user satisfaction, system usage intentions, information quality and service quality. The user satisfaction dimension is compromised considering the fact that Amazon removed some of the products that are similar to the products that it was producing. Also, there were complaints regarding the fact that Amazon was selling books that were copies of the content sourced from Wikipedia. System usage intentions and the information quality is hampered due to the actions of the books authors that were manipulating and adding the reviews in the book review section. The same was misused by the other book authors and they were posting negative reviews. Service quality was hampered and unsatisfactory due to several disputes arising with the selling of controversial products (Zaied 2012).

The measures of success of the existing human activity system failed to a large extent considering the various issues that are associated with it. The first measure is the employee satisfaction, in this measure Amazon failed due to the ill treatment of the employees by their immediate supervisors in the warehouses. The second measure is the customer and in this section also, Amazon failed to satisfy their customers through their faulty service (Ayala and Manzano 2014).

Value chain of Amazon Australia

The new information systems will include the analysis software from the Epiphany, a new Database management system from Oracle and a logistics from manugistics. For the communication purposes Amazon can make a deal with the Excelon for the purpose of integrating the business to business system (Boicea, Radulescu and Agapi 2012). Simple storage system and Amazon Web Service are systems can be developed by Amazon. This system will actively be able to maintain large number of customers and products. Amazon web service can be considered as a standard for the retailers to sell their products (Newcombe et al. 2015). This will help Amazon to create a market dominance through the robust, scalable and reliable web service. Every second thousands of customers are searching and placing orders and for this the system needs to be secured, reliable and fast. A reliable customer relation management system can be placed that can track what a customer is searching, wish listing and data mining. This system will be smart enough to make the analysis and render the services actively. At the same time, Amazon can build a smart analysis search system that will be able to detect any suspicious activity on the website. This system can allow Amazon to personalize the searches of the customer and actively help them. The whole system will be based on a service oriented architecture that will be rendering a decentralized service (Laudon and Laudon 2016).

The new data and the new information that will be involved in the new system are the data based on the customer activities, searches, wish listing, the key words that are mostly used by the customers, products that are searched the most. Along with it data will be generated based on the suspicious activities tracked by the smart analysis search system. The data generated will be directly used for the decision making. The demand for the products that are most searched will be used. Such products will be placed in the warehouses so that they can be easily delivered whenever an order is placed. The data on the suspicious activity can be used to track down the ones that are using the comment section to post fake information and fake reviews.

The new information system will be customer facing and will also be a back-end. The system will be back-end because it will be used to analyse the activities of the customers and thus it will be customer facing as well.

This will positively impact the stakeholders like the retailers, customers, employees. The implementation of the new and improved information system will have a positive effect on the decision making. The first positive effect will be the satisfaction of the customers. With the enhanced data received from the information systems, the retailers will be able to use them to source the products that are more popular among the customers. Employees on the other hand will face excess pressure when the activities within the warehouse will rise. This might lead to further dissatisfaction among the employees. This is one of the negative effects of the new and improved information system.

Competitive strategy of Australia Amazon

With respect to the new and improved information system, the measure of success will reach to its 70 percent level. The enhanced system will have the added benefit of the customer search analysis and the data will directly impact the way the customer places order and gets their products delivered. However, the employee satisfaction dimension will be impacted negatively. The enhanced will put a lot of pressure on the existing warehouse stores and this will increase the work load of the employees in the warehouse due to increased product storage and shipping (Ayala and Manzano 2014).

• Amazon is in a market system where the there is a cut throat competition and the expenses are always sky high. Issues like the free shipment of the books and other types of products will have a negative financial impact on the company. Thus, most of all amazon must charge money for the shipments it is conducting. However, this strategy has a negative impact on the free shipping services that is already existing. So, it is noteworthy that if the Amazon taking away such offers then there is an increased probability of the reduction in the number of customers (Amazon.com 2018).
• Amazon currently operates from several developed countries, however there are several underdeveloped market that can provide a lot of scope for Amazon. Such a move will definitely create larger customer base within different areas in Australia. This step will also increase the number of jobs for the local people residing in the areas with the increase in the revenues. However, one major drawback will be arising from the cost of setting new warehouses and making the accessible to everyone. People in the region might face cultural shock and will be unable to integrate with the work culture.
• Business process management software can be used to automate the financial tasks and the operations. The business process management software is in itself able to create technology that will be able to handle large number of invoices each day. One such solution is the usage of Appian business process management suite that will be able to create a technology system entirely integrate all other tasks in to a single system. This will emphasise a positive impact on the user experience and customer satisfaction (Muntjir and Aljahdali 2013.).
• Business process management can serve specific needs and integrating with the enterprise resource planning can be beneficial for Amazon. Application can be build that can have all the operations related to purchase to pay. At the same time, mobile and social interfaces can be used to access the business process management platforms (Rosemann and vom Brocke 2015).

Conclusion

From the above discussion it can be concluded that, organizations over the world deal with large amounts of data and it data are the facts and the basic values that are organized in to a database. It is considered that information is similar to data while, information includes the information which is required to solve problems and answer questions. Information can be described as a software that helps in the organization and analysis of data. The main purpose of the information system is to transform the raw data in to information that can be used for decision making within an organization. This study emphasises on Amazon Australia and The organizational structure of Amazon is hierarchical and consists of the senior management team of the one worldwide controller, three vice presidents, and two CEOs. There are 7 other departments that include the head of the segments, legal operations, human resources and information technology that report to the Amazon CEO along with the management team. - the several issues that were identified within the existing human activity system are: removal of the competitor’s products, amazon reviews, removal of the kindle content, selling of the Wikipedia materials in the form of books, selling of Nazi T-shirts, treatment of the worker in Amazon’s warehouse, E-book pricing, selling of books that denies the holocaust, blocking the pre-orders on the Disney movies.

References

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