Managing Global Operations Activity at Amazon Company Assessment Answer

Critical Issues for International Operation for Performance Improvement

Some of the key challenges that are observed in Amazon include the management of inventory through the various websites while adding to the street customer services and it comes to handling one fulfilment of the company's high standards. Amazon’s ability to grow depends on meeting certain expectations from their customers to deliver their goods and services at speeds while innovating and adapting to present technology (Bray, et al., 2020). The company is using one of the most sophisticated automated decision-making systems in the world which is helping in simulation, mathematical optimization and machine learning so that they can deliver their products to their consumers across the globe. One of the challenges observed is in the Amazon Supply Chain Optimization Technology (SCOT). The SCOT technology is responsible when it comes to the computation of the delivery promises in the international market (Hallam, 2017). Forecasting demand is one of the challenges facing the company even with the increasing demand for Amazon products. The challenges of making decisions on which product to stock and in the right quantities. Challenges of allocation are also observed in warehouses and fulfilment centres with anticipation of the customer’s needs. The aim is to maximize efficiency while coordinating inbound and inventory management from the millions of sellers in the world.

By they are 2011 Amazon's total revenue had clocked nearly 48 billion dollars and hence they= a need for automation in management and inventory. To overcome this challenge, the company introduced the multi-horizon quantile recurrent forecaster which is a tool that is used in accurately forecasting and shifting seasonal demand internationally. The tool is also very important because it is helping in future planning and event demand spikes (Marder, 2018). The tool is also being used in cold start forecasting and it can show when the company is having limited sales. The tool is also providing a history which is very important for decision-making. These tools have been very important for the company since they are helping in directing billions of dollars of the product flow. The tools are also very important because they are helping in product positioning in the market hence the company can fulfil the demands of customers’ orders.

The other challenge that has been observed by the company is the use of a manual inventory management system. The manual management inventory system is slow and inefficient therefore providing insufficient and logistical results. For the company to improve its delivery promises across the US the company had to introduce the SCOT simulation mechanism that is helping in inventory management, shipping and also cost management. This has helped the company to expand globally with the customer’s demand being met. This has also significantly increased the company’s revenue. The use of inventory planners and control models has also helped the management to be able to understand when the products are out of stock and request them for faster delivery. The mechanism is also working in tandem with the supplies so that the suppliers can track the sales of the various products so that they are always alert to supply the products when they are out of stock. This has helped to avoid the constraints that are observed while maximizing customer satisfaction. Due to the complexity that is observed in the local supply chain network, there has been a need for radical redesigns leading to the adoption of the international marketing system. This system is a multiproduct multi-layered and multi-fulfilment model that is helping in optimizing inventory levels, therefore, helping in delivery speeds and creating space for future demand. The system is also helping in providing the management with the product lead times and capacity constraints, therefore, solving all forms of answer eternity where the real-time customer promises are not fulfilled. This model has made it easy for the company to be able to have demand patterns which are easily forecasted using artificial intelligence tools making it easy to adjust to consumer demands.

International Operations Management and Strategic Vision at Amazon

Amazon has also been able to implement some of the operations management theory to help in managing its delivery and efficiency in production. The operations management theory is mainly dealing with the production process and business operations making them efficient. For that reason, the company has been able to strategize and employed strategies of increasing efficiency in its operations and production. The theory is used in smoothing the operations by providing consumers with the goods and services whenever demanded. The operations management theory is also divided into sub-theories of the business process redesign theory, six sigma, Lean manufacturing and reconfigurable manufacturing system. The theory of swift flow is also used in creating value for the products through its increased flow in the supply chain.

The proponent of the operations management theory was Frederick Taylor who published Principles of scientific operations, Taylor talks of developing a true science when it comes to the scientific selection and management of employees, educating employees through training and intimate cooperation between the management and the staff. The above four theories have been effectively used by the Amazon strategic management team. For example, the business process redesign is being used in the management of the workflow and business processes within Amazon company (Coskun, et al., 2018). The aim has always been to help the company to restructure the organization so that it is designing the business process from the bottom to up. The other theory that is also used by the company is the reconfiguration manufacturing system which is dealing with the production systems that are aimed at increasing changes in the structure, hardware and software components of the organization. This has allowed the company to adjust to the changes in technology increasing its capacity and therefore continuing its production efficiently while responding to the market demands and intrinsic changes.

Tools and Techniques that Operations Managers are Using at Amazon

One of the tools that the company has introduced to manage its cost is the Amazon cloud services and the revenue generation that is paying off through advertisements. The company has been able to use online retail businesses which has created a lot of value customers for them through e-commerce. This has enabled the company to wedge off its most competitive companies like Alibaba (Chou, et al., 2019). For such a company to be able to maintain a large number of retail customers there is a need for localization through geopolitical understanding and the ability to sustain a local and competitive environment. For many years Amazon company has managed to use strategic management that has helped the company to progress through its success.

The other way through which the company is using to manage its cost solutions is by organizing and reporting the cost usage through certified methods. In this case, the company has managed to use real-time visibility of cost usage information to make future decisions. The company is using information technology to help equip them with resources based on the needs of the consumers and visualize and analyze cost and data usage so that they can accurately appropriate the entities (Devaraj & Koh, 2020). The company has also good policies when it comes to costs which are providing the cost data which is making sense to the engineering application and business teams. This allows for data visibility and details so that they are accountable for their expenditure.

When it comes to billing Amazon is using a built-in control system that is easy to access information including the amount of money spent and a breakdown of all the services and costs that have been incurred in the organization. This also allows for the management to observe discounts and credits that have been given to their consumers. This means that the customers can consolidate their purchases and also take advantage of the volumes of discounts which are provided through aggregated usage (VijayaSunder, 2021). Consumers have the advantage of also maintaining control over cost through their governance and security and this is helping the organization to balance and control costs both locally and internationally.

One of the tools that is also used in managing cost is the planning and flexible forecasting tools. The emergence of cloud connectivity is helping in the application of cost hence allowing for budget thresholds and alerts for proper forecasting without exceeding the threshold limit. This means that the consumers can make reservations and converge targets for the reserved products while monitoring how they are conducting their purchases. Through the optimized resources and pricing recommendations, Amazon can take control of the cost and continuously optimise its expenditure internationally. The company is using a variety of pricing models and resources which are helping in the performance of cost efficiency and adjusting as needed. When it comes to evaluation of the Amazon web services the company is also able to manage its architectural and business needs by enabling flexibility allowing consumers to choose among different elements and operating systems therefore providing a wider purchase option (Fetter & Freema, 2019). Through the optimization recommendations, the company can process efficiently some of the cost-optimized resources.

How Customer Value is Contributing to Competitive Advantage

Amazon is creating value for its customers by providing customer-satisfactory services through retail operations and the use of efficient technology. The operational efficiency that is strengthened by technology has made it possible for the company to maintain its competitive advantage and therefore enhance its corporate performance. The company is also creating value for its customers by providing a wide range of products for them to select from their website and ensuring timely delivery of products to exhibit a high level of commitment (Fullerton, 2019). In addition to this, the company has also ventured into a lot of emerging markets through the Internet by modifying its strategies and enhancing consumer experience through online shopping. One of the major strategic positions that the company is using in reducing costs while providing a competitive advantage is warehousing. The costing strategy is helping to maintain a competitive advantage since the warehouses are located in different countries. This allows the company to be able to accurately deliver and efficiently provide goods and services to its consumers. The company is also using eMarketing through the internet, therefore, allowing for additional channels that consumers can use to purchase their products.

The company is also regularly entering into new niches and segments through online shops allowing for the sale of books and other products. The company has advantageously diversified its businesses allowing for continuation and diversification strategy. Currently, the company is gently operating in digital distribution entertainment, consumer electronics, artificial intelligence, self-driving cars and supermarkets. Amazon has also continuously strengthened its ecosystem which is the core of its business linking between the various range of products and their consumers (Gaucher, 2019). The synergy of e-commerce has increased operational systems making purchasing products from Amazon very easy.

Operations Management Framework

Amazon is also well known for its uncompromised service delivery to its consumers. Customer service is believed to be the cornerstone of Amazon's business strategy. Due to the long-term growth strategies the company competitively provides its consumers with the best customer service while ensuring efficiency in the delivery of their products while providing discounts, especially for repeat and esteemed customers.

Amazon is also thriving on good human resource and leadership quality that is providing the company with a competitive advantage. As the demand for products online continues to increase Amazon employees continue to come across a lot of challenges and heavy workloads therefore requiring them to sacrifice workload and life balance (Vipin, 2019). Amazon’s leadership has appropriately helped its employees through its principles of customer obsession therefore insisting on quality service to its employees which has played an instrumental law role in increasing revenue for the company.

One of the strategies that today’s company is using to manage its local and international operations is through the diversified patent portfolio. The company has gradually increased its patent feeling activities for many years and is, therefore, able to take over online retail trade in many countries. The company is also considered one of the biggest potentials when it comes to artificially intelligent media entertainment and even e-commerce. These strategies have helped the company through its website to be able to fight off against stiff competitors who are still using traditional logistical models.

References

Chou, Y., Chen, H. & Chen, 2019. Recency-based storage assignment and warehouse configuration for recurrent demands. Computers & Industrial Engineering, p. 62May (4): 880– 889.

Devaraj, S. & Koh, R., 2020. . Information technology payoff in the retail industry: a longitudinal study.. Journal of Management Information Systems, p. 16(4): 41– 67.

Fullerton, C. M., 2019. The production performance benefits from JIT implementation. Journal of Operations Management, p. 19: 81– 96.

Hallam, S., 2017. Amazon’s Business Strategy: 6 examples of latest trends in ecommerce. [Online].

Marder, L., 2018. Amazon Growth Strategy: How to Run a Multi-Billion Dollar Business Like Jeff Bezos”. [Online]
Available at: https://www.bigcommerce.com/blog/amazon-growth-strategy/

VijayaSunder, M., 2021. Lean additives in a service factory: A design science approach. Technovation, pp. Volume 104, https://doi.org/10.1016/j.technovation.2021.102269.

Vipin, S., 2019. Amazon Business Strategy: Insights Of Its Operation And Investment Plan To Become A Trillion Dollar Corporation. [Online]
Available at: from https://www.greyb.com/amazon-business-strategy/

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