Introduction
Amazon.com is an American e-commerce and computing company headquartered in Seattle, Washington (Dixit and Sinha, 88). Notably, it is the largest Internet-based retailer in U.S and cloud infrastructure services (IaaS) provider in the world. It deals with a range of products, such as downloads and streaming of MP3, audiobook, software as well as video games among other things. Additionally, it sells furniture and toys as well as produce electronics such as Fire tablets, phones and TV among other consumer products. The founder and CEO, Jeff Bezos has seen the company he founded in 1994 grow in both sales and market share to become a household name in many countries. Particularly, he has had a successful transition from the evolution of one product to another. The graph in Figure.1 illustrates the mammoth growth of the sales revenues from $ 6.92 billion in the year 2004 to 107.01 billion in the year 2015. The constant growth has resulted from unique traits and experience of the company's CEO. The paper analyzes the strength and weaknesses of Jeff Bezos and makes recommendations.
Figure 1: Sales Growth
Source:http://www.statista.com/statistics/266282/annual-net-revenue-of-amazoncom/
Strength of the Amazon.com CEO
The consistency and energy demonstrated in pursuing the company mission, “To leverage technology and the expertise of our invaluable employees to provide our customers with the best shopping experience on the market” have fuelled the huge success of the company. Besides the discussed traits exercised by the CEO has pushed the mission into practice and corporate culture. The four traits below have been evident in the CEO way of doing business, and they can be directly linked to the success of the company.
Willingness to invent
The CEO is quite enthusiastic about invention and experimentation; this leads to a variety of products as indicated at its homepage website (Tovstiga, 149). Indeed, he argues that, “If you double the number of experiments you do per year you’re going to double your inventiveness. “This has trickled down to the team around him, and he has used this as a hiring bar bearing in mind that he is also an inventor. Consequently, he has imparted the invention culture in the company and nurtured it among the employees. Mainly, the company has patented products such as the airbag system for phones. Eventually, this culture of brainstorming and experimentation with products is transferred to other aspects of the company giving Amazon.com power over the competitive rivalry because of superior products that are difficult to substitute. This is indicative of motivation promotion because the leader encourages the employees to invent by giving them with required resources. Figure.2 shows the evolution of products and services in the company over time due to the willingness to invent and experiment new ventures. This has given the world new ways of doing things and a lot of conveniences since they can buy things from the comfort of their homes and get deliveries at the door steps.
Figure 2: products evolution
Source: http://www.slideshare.net/Vlacke/amazon-business-model
Thinking long term
The Amazon.com leader sees around the corner when most of the others in the park won't see it. For instance, he foresaw that households would demand goods through the internet long before he started Amazon.com. Here, this leader stresses the importance of being patient and invent new products ideas since their long term sustainability is feasible (Kurtz, 223). As such, it is rational to be misunderstood when working on something that the majority do not understand now but will need it in future. Jeff stresses that "For innovative ideas to bear fruit, companies need to be willing to "wait for 5-7 years, and most companies don't take that time horizon." This leads to products and services that yield customers’ satisfaction and bring new ideas and product in the market. It reduces the substitution and new entry power because other firms will not be able to copy the ideas.
Obsessed with customers
The vision of the company entails, "To be earth's most customer-centric company; to build a place where the people come to find and discover anything they might want to buy online" Notably, the CEO has been stubborn in pursuing this goal, in fact at Amazon.com; they argue that every process and product document should begin with customer in mind and then progress backwards to actualization (Byers, 69). This is instrumental in meeting the customer needs and earning their trust and loyalty. He argues that what is best for the customers is ultimately best for the company and its operations. Particularly, they have an enabled warning that notifies the customers when they are duplicating orders. Though this would decrease the volume of sales from cut duplications, it would build loyalty in the long term. It is also important to note that the CEO allowed the competitors to advertise their prices on the Amazon to improve the welfare of its customers. Expected, it would give customers more choice and variety, which Jeff believes is healthy for customers. This demonstrates the use of decision making and strategy in managing the Amazon.com. In another case, the company invites the customers to review products whether negative or positive (Shanahan, 10). Over time, the buyers have applied the reviews accumulated when making online purchases. Finally, he insists on using technology as a tool to make the customers happy. This has created loyalty and improved sales in the long term. Clearly, the leader uses IT to connect with the customers.
Risks assessment
The leader stresses the importance of identifying and eliminating risks that inhibit the success of the company (Dunne, Robert, and James, 32). He argues that excellent entrepreneurs seek to understand the risks and remove those using systematic approaches. Notably, the risks get bigger and complex as the corporations grow. Therefore, the management and the leader must work in tandem and conduct field analysis to determine the risks associated with such ventures as inventions, new products development, and changing market trends. He has been proved right by the moves of having the customers in mind in all the ventures undertaken because their loyalty tone down the products' failures that has occurred in the company.
Weaknesses of the Amazon.com CEO
Despite the success of the Jeff Bezos in growing the sales and the market share of the Amazon.com, it has little to show in mobile sales. Indeed, such startups as the Wun Wun and Postmates among other have capitalized on smartphones to make an edge in the market. These startups have mastered speed and convenience in comparison to Amazon (fortune.com). Over the time, the leader has not addressed this gap and concentrated on desktops to make sales. It is noted that the mobile sales growth rate is higher in comparison to the e-commerce. This increases the strength of the competition rivalry, substitution and new entry power over the profitability and performance of the Amazon. Secondly, that the product diversification is seen as a way to win more customers while giving them a wide choice, the leader has ventured into products that the leader has ventured into products that he has insignificant strength. This minimizes the focus of the company and uses huge expenses in marketing and development leading to increased competition rivalry from the companies that specialize in few products than the Amazin.com. For instance, the company has ventured into diapers and baby wipes, despite having started as a book store. This also works against the brand of the company in the long term.
Recommendation
There are two recommendations to minimize the weaknesses exhibited by the Amazon CEO. In the first case, the company needs to invent and rethink the mobile sales since the sector has numerous potential to grow the sales volume in the long term. Notably, the smartphone market has reached saturation, and thus, a large number of the household consumers can access the internet and make purchases. Apart from adding to the sales volume, it will also cut the competition rivalry from Wun Wun and other companies. Finally, the company needs to focus on few but superior commodities. Better yet, it can concentrate on few lines of related commodities. This will maintain the brand of the company.
Conclusion
The analysis of the Amazon founder and CEO, Jeff Bezos, presents insights that are useful to the business leaders in different fields. Particularly, the leaders should not lose the focus on the long term goals due to short term gratification. As such, they should invent value and satisfy the needs of their customers as well as assess the risks and make the appropriate adjustments. This will help the business in progressing towards it mission and vision.
Works Cited
Byers, Ann. Jeff Bezos: The Founder of Amazon.com. New York: Rosen Pub. Group, 2007. Print.
Dixit, Shailja, and Amit K. Sinha. E-retailing Challenge(s) and Opportunity(s) in the Global Marketplace. , 2016. Internet resource.
Dunne, Patrick M, Robert F. Lusch, and James R. Carver. Retailing. Mason, OH: South-Western Cengage Learning, 2011. Print.
How Wunwun plans to best Amazon in the same-day delivery wars. (2015). Retrieved April 15, 2016, from http://fortune.com/2015/03/12/wunwun-same-day-delivery/
Kurtz, David L. Contemporary Business. Hoboken, NJ: Wiley, 2010. Print.
Shanahan, Francis. Amazon.com Mashups. Chichester: John Wiley, 2007. Internet resource.
Tovstiga, George. Strategy in Practice: A Practitioners' Guide to Strategic Thinking. , 2015. Print.
