Amazon.com Inc.’s Environmental Scanning

Environmental scanning is a process that entails such steps as monitoring, evaluating, and disseminating information collected in the company’s external and internal environment. This approach is associated with a deep understanding of the external force that provides change (Kumar, 2016). Such an assessment gives an opportunity to develop effective responses to change and allows organizations to secure or improve their market position in the future. The purpose of this paper is to carry out environmental scanning as applied to Amazon.com, Inc.

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Internal and External Environment

Amazon has managed to evolve from a bookseller into an enterprise that offers a variety of different consumer and digital commodities and services to customers from all over the world (Kumar, 2016). It is possible to evaluate the internal and external environment of the company through an analysis of its strengths and weaknesses as applied to its current practices. The main strength of the company lies in its understanding of how the enterprise may use technology to remain innovative (Fabbe-Costes, Roussat, Taylor, & Taylor, 2014). Moreover, Amazon has a developed network of partners with whom it collaborates to provide the best service to the clients. Through the use of innovative technology, the company has been able to offer its customers different digital goods and services on the website. Cooperation with other companies allows Amazon to provide its clients with access to the commodities that are in demand, which has turned the customer base into a loyal audience. In addition, international expansion has allowed the company to maintain its competitive edge and reach new client groups.

Despite specific strengths the enterprise possesses, certain weaknesses may affect its performance. In particular, the business model employed by the enterprise may be replicated by its competitors and further expanded to address the needs of customer groups at the local level (Fabbe-Costes et al., 2014). Moreover, the company exhibits limited brick-and-mortar presence due to the nature of the business. This results in an instance when Amazon cannot attract clients to certain product groups.

Competitive Advantage

Interestingly, Amazon is present in such countries as the United States, Canada, China, Japan, Germany, Italy, France, Brazil, England, Russia. Analyzing the competitiveness of the company, several components of the effectiveness of this world leader in electronic commerce may be distinguished. Firstly, the enterprise has a developed logistics system due to which the goods sold are stored in special warehouses and are delivered to customers’ addresses within the specified period (Kumar, 2016). Moreover, the company strives to reduce delivery times so that customers wait for their purchases less.

Secondly, the company almost always offers the best prices for products and shipping. Thirdly, the main turnover of the company is made up of goods with an optimal return rate. Fourth, the company offers a wide range of products and services, which is constantly expanding (Kumar, 2016). Fifth, Amazon is developing customer loyalty to the brand through numerous bonus programs. Sixth, the company is focused on innovation and continuous enhancement of technologies, which allows it to address the needs of customers and improve service. Thus, Amazon demonstrates a high level of competitiveness that is based on a combination of numerous competitive advantages and the ability to meet the needs of consumers.

Strategies

Importantly, Amazon has had quite a simple strategy from the beginning, and it is adhering to it throughout the years. Initially, the company intended to sell books at a moderate price online. In their shopping experience, users were exposed to a wide variety of items offered at a low cost (Kumar, 2016). It was easy to purchase a book from the website, and then it was delivered to the customer. A simple and positive experience resulted in client satisfaction, and, gradually, the company started offering other types of commodities alongside books. After that, the enterprise reached out to small businesses and built trust with their business associates. Consecutive development allowed the company to expand its operations while maintaining and growing its customer base and increasing sales (Fabbe-Costes et al., 2014). Amazon has evolved into an online marketplace that delivers value to its customers through the goods and services it offers. This approach has allowed the enterprise to gain a competitive advantage over the rivals.

Measurement Guidelines

One of the measurement guidelines the company uses to investigate its strategic effectiveness is industry reports. They allow verifying the brand identity and determining whether the company is maintaining its leadership position in the market (Kumar, 2016). Amazon also conducts surveys among its employees to be aware of the concerns they have or issues that arise in the course of work. Based on the review results, Amazon organizes seminars or training for the workforce. Further on, the organization analyzes systematically whether its current strategy is in line with the company goals (Kumar, 2016). The company does its best to deliver value to its clients and continue growing in the quickly changing core markets through the use of technology and innovation and new partnerships. If sales grow accordingly, this illustrates that the strategies in place are effective.

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Effectiveness of Guidelines

Analysis of industry reports is an effective strategy that illustrates how profitable and successful a company is. Notably, Amazon continues to grow and expand globally, which is also an indication of the fact that the implemented strategies are efficient enough (Dyer, Godfrey, Jensen, & Bryce, 2016). The guidelines utilized by the company allow it to draw conclusions on whether the formulated algorithms bring the desired results (Fabbe-Costes et al., 2014). At present, the enterprise is the leader in the market; nevertheless, it places a particular emphasis on future development. Early detection implemented through the company’s evaluation metrics is the key to further international expansion. Overall, the pathway from a book store to the largest online marketplace serves as evidence proving the fact that the measurement guidelines used by Amazon are effective.

Conclusion

Thus, it can be concluded that Amazon is an enterprise that has managed to maintain its competitive edge through an adequate business approach. The company scans the environment and refines its corporate strategy accordingly to meet the needs of the market. The organization continues to expand its operations in the core markets while providing its customer groups with high-quality goods and services. The successfulness of Amazon lies in its adherence to corporate goals and consistency in the strategy.

References

Dyer, J. H., Godfrey, P., Jensen, R., & Bryce, D. (2016). Strategic management: Concepts and cases. Hoboken, NJ: Wiley.

Fabbe-Costes, N., Roussat, C., Taylor, M., & Taylor, A. (2014). Sustainable supply chains: A framework for environmental scanning practices. International Journal of Operations & Production Management, 34(5), 664-694.

Kumar, R. (2016). Strategic financial management casebook. London, England: Elsevier.

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