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Amazon: The Leadership Strategies

Introduction

This report focuses on leadership strategies since, throughout history, it has been vital for the proper operation of nearly every successful company. Though there are several leadership theories, transformational leadership is among the most effective in organizations (Khan, 2016). Transformational leaders assist followers in growing and developing into leaders by reacting to the requirements of specific followers, motivating them, and matching the aims and goals of the followers, the leader, the team, and the rest of the company. The purpose of this study is to analyze the leadership strategies of Amazon with the UAE as a potential market to determine the essence of the local market and successful strategies for the expansion. Management of the companies in the Middle East tends to incorporate transformational leadership since their culture is focused on cooperation, respect, and incentives. At this point, the UAE proves to be one of the countries with the most practical approaches. Due to ubiquity, diversity, and financial strength, the leadership strategies of Amazon were examined in the circumstances of the UAE market (Figure 1).

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Theory of leadership

The UAE e-commerce industry was selected due to its importance in the local economy and significant contributions, as the Emirates continues to lead their surrounding nations in commercial development and technical breakthroughs. Particularly, the UAE economy is primarily reliant on foreign labor and experts, creating a rich yet productive environment for leadership theories.

As has been mentioned before, leadership concepts and approaches have a direct influence on the organization. Leadership, according to James MacGregor Burns, may be transactional or transformational (Bush, 2018). Transactional leaders are individuals who dominate through social interaction, such as offering cash incentives for output or denying bonuses for inactivity. On the other hand, transformational leaders are those who motivate and inspire their people to accomplish great success while also developing their own talent and potential. For example, Jeff Bezons established such programs as AWS Grow Our Own Talent, Surge2IT, and UXDR Apprenticeship Program (Tongkachok et al., 2021). As a result, these programs contribute profoundly to the motivation of employees and their desire to outperform.

In such respects, transformational leadership is an extension of transactional leadership. Transactional leadership stresses the trade or deal that occurs between leaders, co-workers, and followers. This interaction is centered on the leader sharing what is necessary with others and stating the terms and incentives those individuals will receive if those expectations are addressed (Bush, 2018). Transformational leadership, on the other hand, takes leadership to the next level via coaching. A transformational leader motivates followers to transcend a common direction and goals for a company or department, pushing them to be inventive critical thinkers and growing followers’ leadership ability via “coaching, mentoring, and provision of both challenge and support” (Bush, 2018). Here, transformational leadership has a tremendous impact on the e-commerce industry since the foundation of the industry’s success is the incentives of followers.

As a result, transformational leaders push employees in the e-commerce business to achieve more than they intended or far more than they imagined feasible (Mahdikhani & Yazdani, 2019). People establish greater standards for themselves and, as a result, accomplish better results. Transformational leaders are far more devoted and have contented followers in this industry. Furthermore, with this approach, leaders can guide their followers and attend to their unique needs and personal growth, assisting followers in developing their own managerial skills.

Additionally, companies are accelerating their use of e-business procedures as the digital economy continues to flourish. Successful e-business implementation necessitates IT competencies, which may be attained via leadership (Alos-Simo et al., 2017). People in businesses naturally oppose change, making IT system deployment challenging (Alos-Simo et al., 2017). Due to the obvious accompanying learning procedures and expenses, businesses find it extremely challenging to implement e-business.

As organizations’ strategic direction is critical in deploying e-business capacities, e-business implementation choices begin with the leaders. While other industries might rely heavily on the only workforce, e-commerce relies on technology, and, as a result, there should always be an incentive to reach for better achievements with technology in pursuit of customer satisfaction. Senior executives should resolve to assist employees and influence the dedication of employees (Alos-Simo et al., 2017). As with any process, e-business necessitates administrative action and education courses (Alos-Simo et al., 2017). The link between leadership and innovation is confirmed by research, which recognizes the leader’s stimulation in implementing new technology.

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While these reports demonstrate direct links between leadership and innovation processes, the research also views leadership as primarily concerned with altering an individual’s attitudes and, consequently, with executing procedures. Strese et al. (2016), for example, argue that leadership influences employees’ vision and values and can promote cross-functional teamwork. Even the leader’s words may influence followers’ and the firm’s sentiments (Alos-Simo et al., 2017). Hence, businesses’ innovation processes occur not only as a result of senior management intent but also as a result of cooperation, entrepreneurial orientation, and cultural environment.

When it comes solely to the administration of Amazon, Jeff Bezos was the executive of the company and steered the company’s growth from a modest online bookseller to one of the world’s largest internet retailers. Many people attribute his accomplishment to his style of leadership. He adheres to a few important concepts in order to maintain his development as a company leader (Kastner, 2021). To begin with, he sets a great value on customers’ satisfaction. While it may appear that a CEO would have other greater responsibilities to concentrate on, Jeff Bezos succeeds in establishing a customer-oriented atmosphere via his leadership style.

Jeff Bezos established small teams to work on particular issues and challenges, allowing for greater connection, a more effective means of identifying difficulties, and, at the same time, assisting in the elimination of the hierarchical system that is typically associated with such large enterprises. A healthy competitive climate that fosters the firm’s growth also serves as an incentive for the teams (Kastner, 2021). By outsourcing such responsibilities to his staff, the CEO demonstrates a high degree of trust in his workforce (Kastner, 2021). As a result, Bezos provides them a sense of confidence, which motivates them to perform at the highest level of their abilities.

Another distinguishing feature of Jeff Bezos and his leadership style is the flexibility and almost aggressiveness with which he has addressed the expansion of his corporation. Amazon is known as one of the demanding places to work (Kastner, 2021). According to Denning, this company is not suitable for everyone. The management approach of Amazon is quite aggressive. The well-known company is “aggressive for results,” “aggressive for people to produce and have mastery of their domain,” and “aggressive for teams and leaders to achieve the impossible: perfection.” (Denning, 2019, p. 97). As a result, Amazon incorporates not only coaching but an aggressive tactic.

Hence, in order to expand the company overseas, especially to the countries in the Middle East, there is a need to adapt the leadership model of the industry and the company to local norms. Though Jeff Bezos’ emphasis on inspiring and incentivizing his employees to constantly push themselves to grow is consistent with the core of the transformational leadership style, the must be stress on mutual respect and openness to achieve successful expansion. As a result, while the corporation employs a transformational leadership approach in order to maintain its development, certain strategies must be implemented.

Potential leadership strategies

Businesses compete not only for revenue and profit but also for the long-term viability of these factors. Nowadays, large organizations compete via creativity, personnel management, and corporate resources such as technology. The Middle East is the desired region with many similarities to the European Union. The Middle East comprises 22 nations with varying results and populations, but they all have a shared heritage, culture, language, and faith. Multinational corporations have built a footprint in several Middle Eastern cities, such as Dubai, during the last few decades. This enables businesses to have better infrastructure in supplying their consumers from far Asian nations and reap the benefits of zero-tax regulations, such as those in Dubai. However, during the process of overseas expansions, it is important to understand leadership strategies that will work on the territory of this country.

Researchers in the Middle East notice that Arab nations, particularly the UAE, are classified as multi-active cultures that value emotions and feelings. This has had a significant impact on how Emirate executives engage not only with their own followers but also with employees (Ott, 2016). Like leaders in other multi-active countries, Emirate executives practice leadership with a reasonable approach (Ott, 2016). The fundamental Islamic ideals of respect and external peace inspire administrators to be tough on problems but gentle on individuals. Once foreign managers contact UAE executives, they are struck by their concern for civility, dignity, honesty, and a sense of honor when directing personnel. Strategy and diplomacy supersede rapidity, and a sense of urgency is diminished. It is vital to prevent disagreement and hostility; managers rarely reject their subordinates with a straightforward ‘no.’

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Therefore, transformational leaders in UAE need to go above and beyond ordinary interactions or deals with their coworkers and followers. In order to achieve success in the process of expansion, there should be an acknowledgment of local views and customs. Additionally, a strategy utilized by Bezos and described above could be implemented. The programs for employees implemented by Bezos allow the staff to take part in the decision-making and use innovative approaches to work.

Furthermore, greater results can be achieved by utilizing several of the four basic dimensions of transformational leadership. To some extent, the elements of transformational leadership have developed as both the notion and evaluation of transformational leadership have been refined. Leadership is inherently captivating, and followers desire to associate with and emulate the leader (Bush, 2018). The leadership inspires followers by challenging and persuading them while also offering purpose and clarity (Bush, 2018). The leadership is mentally demanding, allowing followers to make better use of their strengths. Lastly, the leadership is sensitive to the person, offering assistance, mentorship, and guidance to the followers.

Idealized Influence

Transformational leaders in the Middle East should act in a manner that enables them to be role models for their followers without pressure. The leaders are appreciated, revered, and recognized. Followers connect with leaders and desire to be like them; followers see leaders as having outstanding qualities, tenacity, and drive. Thus, intellectual stimulation has two components: the leader’s activities and the features assigned to the leader by followers and other partners (Bush, 2018). The leader highlights the necessity of having a shared sense of purpose, which is important to people in the UAE. The leader reassures others around them that challenges will be conquered (Bush, 2018). For example, Amazon established Glamazon, an affinity group promoting employees to embrace diversity and spread awareness (Tongkachok et al.,2021). As a result, employees feel proud of their workplace and tend to uphold standards.

Inspirational Motivation

Transformational leaders in e-commerce should act in ways that excite and empower people around them by adding significance and complexity to the work of their followers. The team spirit is heightened as a result of this approach. There is an emerging sense of excitement and hope among people (Bush, 2018). Leaders engage followers in visualizing appealing future states; they establish clearly expressed objectives that followers desire to fulfill; and they exhibit dedication to objectives and the common vision. The leader presents an enticing image of the future.

In the case of Amazon, the managers have always proved their compliance to the inspiration of the staff. For example, Jeff Bezos not only articulated but also applied a clear transformational vision. Jeff’s team has known the company’s direction ever since they were employed in pursuit of becoming Earth’s most customer-centric company (Sadq et al., 2018). Consequently, the inspirations and motivations of the director were passed to the employees, giving them energy and expertise for bigger attainments. As a result, the provided leadership strategy complies with the ideology of the company, which means the approach must be incorporated overseas as well.

Intellectual Stimulation

Transformational leaders in the Middle East must inspire people to be inventive and unique by challenging the status quo, redefining issues, and tackling old circumstances in novel ways. Creativity must be valued above everything else to achieve the result (Bush, 2018). However, individual members’ errors are not publicly criticized for the sake of respect. Followers should be recruited for new ideas and innovative issue solutions, and they should be included in the purpose of discussing issues and finding answers (Bush, 2018). Additionally, followers ought to be urged to attempt new techniques, and their views are not ridiculed if they differ from those of the leaders.

This kind of intellectual stimulation is intertwined with Amazon’s strategy. Getting people on board and gaining their devotion is reflected in their famous internal motto, which is focused on working hard but at the same time having fun and making history (Sadq et al., 2018). Intellectual encouragement of employees makes them driven and motivated to achieve the bigger result (Sadq et al., 2018). There is no pressure between management and staff which is important in the Middle East. While incorporating the organization’s policies and standards into the expansion to the United Arab Emirates, it will be important to start with small steps and take all necessary points into consideration.

Individualized Consideration

By serving as a coach or mentor, transformational leaders should pay close attention to each particular follower’s requirements for accomplishment and progress. Since the UAE customs and norms may vary, there is a specific need to pay attention to the requirements of local staff. Followers and coworkers are progressed to greater degrees of aptitude. Personalized attention can be used when innovative educational possibilities are offered in combination with a supportive environment (Bush, 2018). Individual diversity in requirements and preferences should be acknowledged (Bush, 2018). Moreover, tolerance of individual differences should be demonstrated through the leader’s actions. Some workers, for example, are given greater incentives, some more independence, others stricter requirements, and yet others more organizational structures.

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Interaction is required to be two-way, and leadership should be conducted through going around workstations. Personalization should be used in exchanges with followers. The leader, for example, could recall introductory talks or is aware of particular issues and views the person as a unique individual rather than simply a worker (Jensen et al., 2019). As a technique of creating followers, the leader should assign duties (Jensen et al., 2019). Delegated tasks should be watched to discover if followers require further instruction or help, as well as to evaluate performance; preferably, followers should not feel watched on.

A role suitable for a transformational leader is to empower other leaders and participants. In this situation, when Jeff’s distribution centers were in upheaval, he began to rely on other executives, whose intellectual and somewhat impatient managerial styles resembled his own (Sadq et al., 2018). While the business tended to be unpredictable and there was a lack of stability in the sales, the strong workforce contributed to the growth of Amazon and its expansion (Sadq et al., 2018). Jeff also recalls the well-known Carnegie concept of building the right team to get the task done by motivating and enabling competent members of the team. Thus, approaches of Bezos are reliant on his own transformational strategies and the help of other leaders.

Transactional leadership

The entire array of management paradigms contains multiple aspects of transactional leadership behavior in addition to the four dimensions of transformational leadership. Transactional leadership happens when the leader either rewards or punishes the follower based on the follower’s progress (Jensen et al., 2019). Transactional leadership is based on partial pressures, which can be either constructive conditional reward or the more negative active or passive types of management-by-exception. Thus, combining two approaches with different strategies will have a positive influence on the management of the overseas company. Amazon concentrates on several approaches described below to acquire the desired results and respect from the employees.

Contingent Reward

This constructive transaction has been proven to be somewhat successful in encouraging people to greater levels of growth and performance, albeit not as efficient as any of the transformative components. Contingent reward leadership entails the leader allocating or securing follower cooperation on what has to be done in return for claimed or real benefits in response for successfully finishing the project (Jensen et al., 2019). When the reward is tangible, such as a bonus, contingent compensation is transactional. When the incentive is psychological, such as praise, the contingent reward can be transformative. For example, in addition to bonuses, Amazon pays for employees’ courses on self-development or various skills even if they are not relevant to their career at the company (Tongkachok et al., 2021).

Management-by-Exception

This corrective interaction is less successful than contingent compensation or transformational leadership elements. Corrective intervention might be active or passive. In active intervention, the leader prepares for the follower’s tasks to be actively monitored for deviations from norms, inaccuracies, and failures and take the appropriate action as needed (Jensen et al., 2019). Passive intervention denotes passively waiting for deviations, accidents, and mistakes to occur before implementing control measures (Jensen et al., 2019). In this situation, Amazon does not tolerate inaccuracies and might fire an employee for deviations, which is constantly covered in news articles. In certain cases, such as when security is of the utmost concern, being active may be essential and beneficial (Jensen et al., 2019). Leaders must sometimes remain inactive in order to oversee a large number of employees who report directly to them. The leader draws attention to inadequacies to fulfill standards (active), and the leader refuses to act until complaints are made are two examples of management-by-exception (passive).

Therefore, the successful expansion of Amazon to the UAE is ensured in the case of both transformational leadership strategies for motivation and encouragement and the addition of transactional leadership strategies for rewards. As a result of an overseas expansion, the leaders of Amazon will have to take cultural differences into consideration. Regardless of initial leadership strategies, it is of utmost importance to comply with the standards and norms of the Middle East. While e-commerce is growing around the world, Amazon is playing a crucial role in expanding the business. As a result, the chosen region with its lenient tax system and a rapid-growing economy will have a positive influence on the organization’s further expansions.

Conclusion

Hence, the industry of e-commerce is developing around the world, with the UAE being preferred due to rapid economic growth and lenient taxes. However, while Amazon, one of the examples of fast-changing e-commerce companies, is utilizing the transformational leadership approach, the expansion of the company overseas needs to make renderings. Therefore, a leader will have to implement two-way interaction with employees, assisting, coaching, and motivating them to achieve bigger results and faster expansion. Additionally, there need to be transactional leadership rewards, such as bonuses. However, the norms of the work environment of people from the UAE are focused on mutual respect, tolerance, and strategic approaches. Consequently, the leader needs to be aware of local ways of organization in order to ensure the success of the expansion and incorporation of the company into the local economy.

Reference List

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Khan, Z.A. (2016). Leadership theories and styles: A literature review. Journal of Resources Development and Management, 16(1), 1-7.

Strese, S., Meuer, M.W., Flatten, T.C. and Brettel, M. (2016) ‘Organizational antecedents of crossfunctional coopetition: the impact of leadership and organizational structure on cross-functional coopetition’, Industrial Marketing Management, 53, pp. 42-55. Web.

Ott, U. F. (2016) ‘The art and economics of international negotiations: Haggling meets hurrying and hanging on in buyer–seller negotiations’, Journal of Innovation & Knowledge, 1, pp. 51-61. Web.

Tongkachok, K., Garg, S., Sakthimala, B., & Vijayalakshmi, N. S. (2021). Impact of transformational leadership on organizational performance through employee motivation. SPAST Abstracts, 1(01). Web.

Appendix

Expansion of Amazon around the world
Figure 1: Expansion of Amazon around the world

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