Amazon should establish cargo facilities in Beijing, New Delhi, and Munich and introduce the prime delivery service in these regions, which will require a sound strategy with the focus on effective information systems (IS), human resource management (health risks) and urban pressures in the areas discussed.
Changes in the transportation and logistics department
Amazon has an effective transportation and logistics department that is undergoing considerable changes.
- Amazon is developing its air transportation fleet and facilities (BI Intelligence, 2017).
- The company has a significant fleet of ground and water transportation (BI Intelligence, 2017).
- The company is planning to establish a cargo facility in China (BI Intelligence, 2017).
Developing services in regions
The introduction of the prime service in more regions can help the company build a positive image and make more profit as many customers in such regions as China, India, and Europe are ready to pay more for certain services and products especially when it is associated with saving their time.
The development of “more intimate” relationships with customers is one of the megatrends of the modern logistics, which implies the delivery of premium services to the most valued clients and which has already become a competitive advantage for many companies (Stank, Autry, Daugherty, & Closs, 2015, p. 9).
The regions mentioned above are attractive in terms of their potential as India and China are multi-million markets with thousands of clients ready to pay more for extra comfort.
Munich is an important European hub that can enable Amazon to provide services faster in European countries such as Germany, Austria, France, the Czech Republic, Liechtenstein, Switzerland.
The use of information systems
The use of effective information systems is essential for companies expanding into new markets as it is associated with better performance of employees and more efficient operations.
The use of information systems is another megatrend that is a characteristic feature of the 2010s, and companies that manage to utilize effective information-sharing systems have acquired a competitive advantage (Stank et al., 2015).
Amazon employs efficient IS that enables the company to provide high-quality services, but it is essential to utilize the existing systems properly in the new setting.
Apart from quite substantial investment in the establishment of the cargo facilities, extensive training of local employees may be needed.
Human resource management
Human resource management is another area to focus on when developing new cargo facilities in the cities mentioned as such issues as labor laws differences and cultural peculiarities should be addressed.
Labor laws in China, India, and the European Union differ from those existing in the USA.
Health safety is still a significant concern for many companies including Amazon as cargo facilities are associated with high health risks that can result in injuries, legal issues reputational risks (Jaffee & Bensman, 2016).
Training is one of the key elements of effective human resource management, and Amazon should provide the necessary training (which takes into account cultural peculiarities) to local employees in the new cargo facilities.
Environmental pressures should also be taken into account when developing new cargo facilities like air transportation delivery to a facility that does not mean timely delivery to the customer.
Increasing population levels can be regarded as the central issue that should be taken into account by delivery companies as they may face various difficulties (Rose, Mollenkopf, Autry, & Bell, 2016).
The issue mentioned above is associated with the lack of proper infrastructure in China and India that may pose certain threats to timely delivery, which makes prime services difficult to introduce.
Rose et al. (2016) note that local institutional entities struggle with these issues so companies should collaborate with these offices to ensure their proper development and growth.
Steps of the change implementation
Particular steps to implement are associated with such areas as human resource management, the use of IS, the collaboration with local institutional entities, social and environmental responsibility.
Training programs for local employees
It is essential to develop and introduce effective training programs for local employees in the new cargo facilities, and the programs should take into account the cultural peculiarities of the mentioned regions.
The use of information systems
The company should also ensure the use of effective information systems in the new facilities, which is associated with the corresponding allocation of funds as well as the need for training.
Imroving the infrastructure
Amazon should make sure that the infrastructure is appropriate for the provision of high-quality services, which may require close interaction with local officials and institutional entities (especially in China and India).
Corporate social responsibility
Amazon may benefit from involvement in projects aimed at sustainable development of the regions mentioned as it may help the company develop and maintain a positive image, which is crucial in the modern business world.
Health and occupational safety
The company should ensure that all the standards associated with health risks can be followed in the new facilities (which is associated with possible additional costs and a corresponding training program for employees).
It can be effective to focus on the corporate culture maintenance with the focus on such values as attention to customer needs, employees’ development, sustainability as well as social and environmental responsibility.
BI Intelligence. (2017). Amazon is opening its first air cargo hub. Business Insider. Web.
Jaffee, D., & Bensman, D. (2016). Draying and picking: Precarious work and labor action in the logistics sector. Workingusa, 19(1), 57-79.
Rose, W., Mollenkopf, D., Autry, C., & Bell, J. (2016). Exploring urban institutional pressures on logistics service providers. International Journal of Physical Distribution & Logistics Management, 46(2), 153-176.
Stank, T., Autry, C., Daugherty, P., & Closs, D. (2015). Reimagining the 10 megatrends that will revolutionize supply chain logistics. Transportation Journal, 54(1), 7.