...STRATEGIC MANAGEMENT CASE STUDY B : AMAZON 1- By using Porter’s 5 forces’ framework, describe the forces that affect the core initial market of amazon (the online retailing industry) The power of Suppliers: Suppliers are not concentrated : thousands of publishers throughout the world. The inputs are not necessarily rare. The power of Suppliers: Suppliers are not concentrated : thousands of publishers throughout the world. The inputs are not necessarily rare. The power of Buyers: Buyers have a high bargaining power because of the low switching costs the Internet market allows. Besides, the market is very competitive, and that ensures a high power to consumers. The power of Buyers: Buyers have a high bargaining power because of the low switching costs the Internet market allows. Besides, the market is very competitive, and that ensures a high power to consumers. Potential competitors: Apple, Microsoft, and Google IBM, Sun system, barns and noble. Potential competitors: Apple, Microsoft, and Google IBM, Sun system, barns and noble. The threat of substitutes: Customers could switch to alternatives if traditional web retailers promote a substitute with a higher value such as Wal-mart that becomes more and more competitive on the Internet market. The threat of substitutes: Customers could switch to alternatives if traditional web retailers promote a substitute with a higher value such as Wal-mart that becomes more and more competitive on the...
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...CASE STUDY 2 : AMAZON.COM | 1. By using Porter’s 5 forces’ framework, describe the forces that affect the core initial market of amazon (the online retailing industry) (5 points). Threat of new entrants: MEDIUM TO LOW * Creating a website is cheap, unskilled or old people can set up a little retail business shops fairly easily but E-Retail is a difficult-to-master business. Moreover, since the “technology bubble” burst two years ago, many people are threatened to enter the game. * BUT cost to establish an online retail outlet is high: * Start up capital with long term investors * Maintenance cost of equipment and expertise * Compliance of government regulations on data protection and privacy * The possible use of patents and proprietary resources * Marketing and advertising cost * Technology cost R&D * Distribution cost * By the way, Internet has shown to us that a simple idea well developed can offer extraordinary results, examples such as Facebook.com, Plentyoffish.com, Youtube.com and so forth, these companies have developed their web sites in a short period of time with incredible final results. This can be the proof that a threat of new entries into the market is possible. Threat of substitutes: MEDIUM RISK * The way how e-Retail business works today creates a lot of substitute threats to conventional retailing players. Amazon.com itself started as a substitute of conventional...
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...Amazon Strategy Analysis The strategic planning processes. Amazon and other large enterprises to build your organization with a view - from the view of the company’s mission, goals and objectives are developed. Many times during the life of an organization is necessary for the organization to redefine the objectives of the organization on the basis of profitability, customer concerns, and the internal, external and international challenges. • Value Chain • Resource Based View • Financial Analysis Using an Analysis of the Value Chain Amazon Amazon has developed an analysis of the value chain of its Competitive Advantage “own internal operationally better assess how you can add value and sustain competitive advantage have used the value chain model of Michael Porter,"Create and maintain superior performance. " Example of a Strategic Plan Model - Amazon Internal Analysis Tools, Strategic Planning, Strategic Planning Models Primary activities and support activities Primary activities are those needed to produce a product or service to the end customers. These activities generally include: • Inbound Logistics: receiving goods from suppliers, and store and move the good • Operations: Manufacturing or assembly of the product • Outbound Logistics: The shipment of goods to wholesalers, retailers or directly to the final customer • Marketing and Sales: Marketing involves customer needs understanding, communicating...
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...Strategic Quality Management and Customer Satisfaction Paper Effie Dillard, Joaquin Mercado, Sherri Copeland MGT/449 June 20, 2011 Tracy King-Dye Strategic Quality Management and Customer Satisfaction Paper The History of Amazon.com In the beginning Amazon.com conducted business out of a two car garage in Bellevue, Washington. Today this retailer headquartered in Seattle, Washington has one of the largest organizations on the internet. By employing thousands of employees the organization has gained outstanding success. Customers from all over the world can purchase books, movies, and thousands of other products with just a click of a computer mouse. Amazon.com was introduced to the world in 1994 by Jeff Bezos who resided in Bellevue, Washington. “With a small investment and only one investor Mr. Bezos was able to secure a user friendly website and ship orders to 50 states and over 48 countries. During this time books were the only products that were available”. (The History of Amazon.com, 2011) “By creating a powerful community based website, customers were able to add their book reviews for all customers”. (The History of Amazon.com, 2011) In May of 1997 Amazon.com went public and by public demand the share price went from an expected $18 to $24 a share with total earnings of $54 million dollars. Within the last decade through expansion and popularity, Amazon.com opened international sites in Germany and the United Kingdom...
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...Strategic Choice and Evaluation Paper STR/581 March 18, 2013 Dr. Robert Rowlett Choosing a sustainable business strategy is not an easy choice but there are companies who have done it and continue to do so. One such company is Amazon.com who first opened their virtual doors in 1994 and “emerged from the dot-com bubble one of the few winners and continued to blaze a trail of impressive growth (from about $4 billion in 2002 to nearly $20 billion in 2008),” (Johnson, 2010.) Companies like Amazon.com survive and thrive because of sound business decisions based upon sound business models. Their business model is based in strong management strategy. In this paper we will explore alternative Generic strategies, value disciplines, and grand strategies for Amazon.com based upon past performance focused on continued success. Generic Strategies “A long-term, or grand strategy must be based on a core idea about how the firm can best compete in the market place. The popular term for this core idea is generic strategy, from a scheme developed by Michael Porter,” (Pearce & Robinson, 2011). Porter believed that the generic strategy should be directly tied to the company’s performance in the marketplace in this way a firm could leverage its strengths and become stronger. Porter suggests that companies will subscribe to one or more of three types of generic strategies: Low-Cost Leadership, Differentiation, and Focus. Amazon.com has enjoyed the success of a focus strategy in the past. This...
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...I have been looking at some of the work of Rob Grant to analyse resources and capabilities, mainly examining work in and around Resource Based Theory of Competitive Advantage and implications for Strategy Formulation. So hopefully have covered some differing aspects to use for Amazon. Strategic Planning Processes. I believe an effect method for Amazon to undertake such an analysis would be to examine: • Value Chain • Resources Based View • Financial Analysis Use of a Value Chain Analysis for Amazon Amazon have developed a value chain analysis of its’ own to internal asses how it can operationally best add value and maintain a competitive advantage. They have used the value chain model from Michael Porter's book, "Competitive Advantage: Creating and Sustaining Superior Performance." [pic](Source: Bua Consulting) Example of a Strategic Plan Model - Amazon Internal Analysis, Strategic Planning Tools, Strategic Planning Models Primary Activities and Support Activities Primary activities are those needed to produce a product or services for the end customers. These activities typically include: • Inbound Logistics: receiving goods from suppliers, and storing and moving those good • Operations: Manufacturing or assembling the product • Outbound Logistics: Sending the goods to wholesalers, retailers or directly to the end customer • Marketing and Sales: Marketing involves understanding customer needs, communicating those needs...
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...-4 | 1.0 Positioning in Relation to Porters GenericStrategies * Strategic Models * Stakeholder Analysis.....continued on page 5 | 5 | Value Chain Analysis | 6 | 2.0 Business & Corporate level strategy | 7&8 | 3.0 Alternate strategy * Critical reflection | 9 & 10 | Bibliography/Harvard referencing | 11 & 16 | Supporting Appendices | Total word count : 2725 Inc titles/subtitles. Amazon’s Strategic Positioning. 1.0 Introduction This assignment is to establish Amazon’s strategic positioning in Europe in correlation with value innovations that may have contributed to Amazon’s success from 1995 to 2012. About Amazon Amazon is an eCommerce business based in the U.S and was started back in 1995 selling books, CD’s and other media. However Amazon’s profits were only noted in 2002 and to this day have annual sales equal to or more than $40billion with a customer base of nearly 144 million in purchase accounts and over 2 million market seller accounts. In 1998 Amazon also extended their market to the UK with an agreed takeover of Bookpage.co.uk and has since managed to establish their second biggest and most successful market overseas. Value Innovations. Since reporting profits in 2002 Amazon has invested in innovations that add value to the customer, keeps interest and encourages ease of purchasing. Some innovations that have aided in the success of Amazon tend to allow ease of use and convenience, this combined with special...
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...Project Company is a consulting firm that focuses on the comprehensive needs of business organization. We offer a full range of expertise that can assist a company in retaining a competitive advantage against its competitors. We are a staff of five experienced professionals who have successfully helped many organizations plan, create and achieve their objectives. We offer a professional team approach that can bring balance to any organization. The Manhattan Project Company’s consultants specialize in specific areas which include services such as SWOT analysis, sales and marketing, competitive analysis, finance, strategic planning and many others to assist any organization with their needs. We invite business owners and organizations to choose our services and let us show you how we can help you enhance your business. Introduction CanGo’s executive management has contracted with The Manhattan Project Company to provide consulting services in order to understand how to grow its business. We have looked at some areas within the organization and found a few key areas that will assist the company in reaching its goals. SWOT Analysis Strengths: CanGo has turn out to be one of the fastest growing online small business companies. CanGo has different variety of products to offer. They have labeled themselves as “the customer”. By doing this it permits them to keep the question “what do we want” in the front position of the attentions all while concentrating on recognizing...
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...Strategy 1 Amazon STRATEGIC ANALYSIS OF AMAZON Submitted for: MBA IN MS (MANAGING STRATEGY) TUTOR: PAUL ANDERSON SUBMITTED BY: C0411672 Managing Strategy 2 Amazon CONTENTS Title..................................................................01 Contents....................................................... 02 Introduction.................................................03 Section 1 Current strategic position......................04 Macro environment.................................... 04 Micro environment......................................07 Strategic Capabilities................................10 Section 2 Current and Future strategy..................13 Bowman’s strategy clock.........................13 Section 3 Implementation issues............................... 16 Cultural web................................................16 Kotters 8 step theory................................18 Conclusion....................................................21 Reference list..............................................22 Appendix..........................................................30 Managing Strategy 3 Amazon INTRODUCTION Amazon is an e-commerce platform based organisation established in 1995 by Jeffrey P. Bezos. Amazon.com is based in Washington, United States. Amazon is recognised as customer centric e-commerce organisation giving wide varieties, low price offers and convenience to its customers by offering services virtually. Amazon provides...
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...leaving N.Y. City for the Pacific Northwest. On its 15th-anniversary in 2010, Amazon is truly proud to be one of the world largest online retailers, selling everything from musical instruments and sports equipment to household appliances and apparels (Kayla, W. 2010). In our coursework group assignment, we are tasked to study and analyse the strategic management issues of Amazon.com. The case study will base on fourth quarter of 2007 as a current year. We will be evaluating the company's external and internal environments, how the company emerge into the industry by means of its strategies management in dealing with economic, technology & distribution issues and competition. We will also look at the company's vision & mission and it relate to the expansion of its product lines and reach, to increase its revenue and market share, and to understand and consider their possible near-term and long-term objectives that the organization could pursue. Lastly but not least, to out up recommendation for Amazon and conclude it with our learning experiences on BPS module. Page 3 of 27 2. Company Overview Amazon was founded by Mr. Jeff Bezos in 1994 with head office in Seattle, Washington, the company is one of the most customer-centric companies in the World and has grown to be a Fortune 100company. It has a diverse range of product offerings over at extensive network of customer service centers (About Amazon, 2007). Amazon.com is one of the most popular names on the internet, it operates...
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...Amazon case study 1. Analyze Amazon.com each year from 2004 to 2006. • 2004 = SUCCESS - Good net profit - Low price strategy - Use of commercial tools: discounts and free shipping - Launch of A9.com - Acquisition of Joyo.com - Largest database of book - Culture of “innovation” - Creation of “pizza teams”: improve innovation - Technological problems - Many litigations - “Gold box”: online design tools - Diversification of products and commercial tools. • 2005 = GROWTH - Growing revenue of 24% but decreasing of the profit margins - Strategic partnerships (Marks & Spencers) - Assortment of acquisitions (BookSurge) - High ranking in customer satisfaction survey (2nd) - Drugstore become a competitor - Hire product expert - Development of various facilities: Toxona... • 2006 = DECREASE - Amazon S3 (Simple Storage Service) - Alexa Internet (a subsidiary of Amazon) launched the Alexa Top Sites Service - Amazon Connect: allow authors to send messages to the readers - Start competition on the digital music market (Apple’s market) - Amazon “gold standard” in customer satisfaction for online shopping - Stay focus on global expansion (strategic plan) - Diminution of the turnover due to an unfavorable lawsuit against ToysRus.com - Negative impact on share price ($ 35 in 2006; highest value in 1999 $106,69,lowest $5.97 in 2001) -...
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... Club IT Part Three Ron M. Davis March 20, 2011 Michael Diaz Running header: Club IT Part Three 2 Lisa and Ruben are the club owners. In our initial meeting we discussed what was expected of the job that was being undertaken. They explained to me a little about the club and an overview of their need to boost their information technology, data management, and decision-making capabilities. “To learn more about Club IT’s operations, we stayed until the 2:00 a.m. closing this morning to see how everything was tallied and accounted at the end of a business day. Although it was a late night and we had to wake up early this morning to report back to work, we now have a better understanding of the daily business cycle at Club IT. Lisa asked me for suggestions on how to use club and public resources to keep Club IT’s edge as the high-energy, high-impact club it strives to be”.(Wiley, 2009) “Lisa and Ruben have just completed extensive remodeling of the interior of Club IT and are pleased with the results. The club’s tall ceilings and high-energy lighting creates an ambience of fun...
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...In 2005, Amazon measured the inter-company balances, making use of the exchange rates at the specific reporting dates and recorded a massive loss of $47 Million, against the gains of $41 Million in 2004, and $36 Million in 2003. This has been accounted to a great deal to the currency adjustments. (Amazon Annual Report 2005) In 2006, the net cash provided for operating activities was $702 Million. There was an increase in the Marketing costs, compared to 2005 and 2004, as an outcome of a rise in spending for variable channels of online marketing in activities such as sponsored search, Associated program, and other variable initiatives in Marketing(Amazon Annual Report 2006) . In 2007, Amazon Kindle was introduced to the customers, which was a reading device built with purpose, and had wireless access to over 110,000 books, blogs, magazines, and newspaper. Amazon had hoped that Kindle will be well received, but the entire stock was sold out within the first five and half hours, and the entire supply chain and the production team had to work hard and fast to recreate the stock to cater to the demands in the market for Kindle. This shows that Amazon had once again aligned its business to customer centrism through creation of an innovative device, by understanding the customers’ needs of what they do not know but they want. This directly impacted the publishing industry and necessitated the need for creating E-books, for Kindle reading, increasing the sale of books, again impacting...
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...key people within the corporation is called environmental scanning. (Wheelen and Hunger. 2010) Environmental scanning helps an organization identify relevant factors and use those factors to obtain a competitive advantage within the environment. The author will discuss how an organization creates value and sustains a competitive advantage through strategies. How an organization measures success to identify the effectiveness of a strategy. The author will identify the strategies of various companies and identify tactics that make the company successful. Competitive Advantage An organization that has a strategic advantage over its competitors that enables the organization to have greater sales and retain more customers is believed to have a competitive advantage. Many organizations have a competitive advantage within technological industries to include: Google, Apple, and Amazon. Each organization creates value in its products and services to stay ahead of the competition. Google is considered the industry leader when it comes to search and has 65% of the search market, according to Hit Wise. The company maintains its competitive advantage by developing a diversified infrastructure that gives them the ability to provide high-speed searches and branch out into other industries. Goggles infrastructure is made up of hardware, bandwidth, storage systems and servers. The company has access to all kinds of information about the organization from all over the world and can easily track...
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...Burgers 1989). Companies pursuing related diversification over a period of time have achieved superior performance than companies following an unrelated diversification (Palepu 1985). Amazon has started its business by selling books and music, soon after it incorporated online auctions for airlines tickets and hotel rooms, computer hardware, pet food and pet accessories, electronic cards, toys and consumer electronics. Whereas Amazon has achieved very high volume of sales and gained important market shares in the book industry, the company has never been profitable. As a result, in this essay, in order to determine if Amazon’s decision to diversify so extensively was a wise decision, we will firstly describe the firm business model and the reasons for its success. We will then try to determine if this business model is applicable to Amazon’s diversification strategy as well as the limit of diversification. And finally we will try to evaluate the limit of such strategy in an international context. I Is the business model designed for selling book on internet apply for different category of products? The success of Amazon Business Model In e-tailing, one can identify four kinds of business models: the channel supporter, the vertical portal and the category killer such as Amazon. In this regard, Calkins, Farello and Smith Shi (2000) identify three fundamentals of on-line...
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