Case Study (Amazon) - Final PDF

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Final assignment, Amazon case study....

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Cover Page Course ID: BUSM4554 Course Name: Contemporary Management: Issues and Challenges Assignment No: 3 Assignment Name: Case Study (Individual) Student ID & Name: S3717141, Mia Moadim-Lesimha Teacher: Apsara Sabaratnam

Table of Contents Cover Page

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Table of Contents

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Executive Summary

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Introduction

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Stress and Coping in the Workplace The issue and its impacts on Amazon Recommendation for how Amazon can address these issue Risks of Amazon not addressing them

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Performance Management The issue and its impacts on Amazon Recommendation for how Amazon can address these issue Risks of Amazon not addressing them

7 7 7 8

Workplace Mental Health The issue and its impacts on Amazon Recommendation for how Amazon can address these issue Risks of Amazon not addressing them

9 9 9 10

Conclusion

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References

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Executive Summary Amazon was founded in 1994 by Jeff Bezos. The company started as an online marketplace for books yet expanded to sell all manner of electronics, software, video games, apparel, furniture, food, toys, and jewellery. The name Amazon was chosen honouring the Amazon River that is the largest river in the world. Additionally, the letter “A” would ensure the company would show up at the top of any alphabetical list. Amazons stock was opened to the public in 1997 at just $18.00 per share, the stock prices over only the past 10 years have grown from around $20 a share to nearly $170 per share. The last 'great climb' in stock prices began in 2008 and the company has managed to stay on top. Amazon's goal for the stock price is $400 per share (Sandeep, 2005). Amazon faces many issues as an organisation this report will focus on; work-life balance, managing performance and mental well-being in the workplace. The current culture within Amazon does not allow for healthy work-life balance for employees of the organisation. If Amazon neglects to address these issues they may face HR-related risks. To address this issue Amazon should develop a culture that supports and considers workers private lives. As performance management has become easier with the use of technologies it has also created issues affecting performance management regarding big data. If Amazon neglects to address this issue, it has the potential to lead to severe legal implications. To address this issue Amazon should create a performance management plan that is data-driven. Additionally, Amazon struggles with the level of stress employees feel resulting in employee burnout. If Amazon neglects to address this it will further impact staff turnover, absenteeism, decreased performance, workplace accidents, mistakes and difficulties with the acquisition of ‘talent’ (Jankome et al., 2013.). Amazon should create a three-pronged system specifically designed to fix this issue.

Introduction Amazon is a vast Internet-based enterprise, started as a bookseller, founder Jeff Bezos insisted that the site was not simply a retailer of goods. He contended that Amazon was a ‘tech company’ that’s vocation was streamlining online sales for consumers. By October 1997, Amazon had over 1,000,000 consumer accounts. Profits surged from $15.7 million in 1996 to $148 million in 1997, supplanted by $610 million in 1998 (Hall, 2020). Amazon’s rapid achievement launched its Bezos to become Person of the Year on Time  magazine in 1999. Since then Amazon has continued to rise in success, making  Bezos the ‘Richest man in the world’ and dominating the online retail industry. This report will focus on addressing the contemporary management issues and challenges that Amazon faces. Specifically; stress and burnout in the workplace, managing performance and mental well-being in the workplace. Further, this report will analyse the risk these issues pose should they be neglected and offer recommendations as to how best to resolve the aforementioned challenges.

Stress and Coping in the Workplace The issue and its impacts on Amazon Amazon employees recently detailed workweeks in excess of 80 hours, taking no actual holidays or leave of absence, and a prevalent ‘always on’ corporate culture. Amazons poor work-life balance for employees has been exacerbated through technology-enabled working, as access to internet-connected devices enable workers to operate everywhere, at any time.

According to PWC (2013), this issues is critical to address as workers understand that unreasonable performance requirements in no way condone the adverse influence on their private life. Many employees are willing to surrender wages and postpone career advancements in return for flexibility at work (PWC, 2013). This sentiment is continuously increasing amongst employees, particularly with working parents, individuals with caring duties and employees that are profoundly qualified. PWC (2013) found that employees will choose to forgo a traditional career track when faced with poor work-life balance, leading to notable difficulty regarding the retention of employees. Furthermore, in a technologically driven organisation like Amazon, 'tech' represents an influential function in the expansion of the scope of performance, presenting unwanted flexibility that allows employers and employees to increase performance times (Al-Saidi, 2015). The constant access through the internet has caused the line between professional and private life to blur, causing employees to feel overworked (Vlačić, 2013). This effects employees stress and emotional/mental state which diminishes their capacity to effectively work. Research reveals that for employees to be effective and innovative they necessitate the absence of leave from work (Sloan 2005) This indicates that to entice and preserve the most qualified employees, Amazon needs to focus on employees’ work-life equilibrium. Moreover, Amazon should shift away from the 'always on' culture and offer a more flexible workplace, this would additionally enhance career satisfaction (Lazar, et al., 2010).

Recommendation for how Amazon can address these issue To address this issue Amazon should form a culture that encourages and considers workers private lives. Attaining work-life balance necessitates an approach that is two-dimensional. Firstly, understanding what employees can offer themselves individually and secondly, understanding what Amazon as an employer can offer employees, (Saidi, 2015). What employees can offer themselves individually is specific to each employee based on the

private life, goals and situation of each employee. Amazon should, therefore, focus on what they are capable of providing as an employer. Specific recommendations for Amazon are offered here: - Investing time, capital, and effort to better understanding connecting with employees. The use of surveys and feedback forums to profile and monitor the needs of employees (PWC, 2013). -

Human Resources (HR) can develop systems that: a) See the equilibrium of work and life as a fundamental element to competitive business(Al Saidi, 2015). b) Offer employees greater flexibility regarding work hours, absence of leave, care duties and the location of work. This would necessitate an official method for petitioning the aforementioned.

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Formulate systems that foster a supportive culture, that is empathetic to the needs of employees. Specifically, management should be assessed on the work-life balance of their subordinates and the support they offer to improve it (Lazar, et al., 2010).

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Monitor the utilisation of technology, to circumvent the overflow of work into employees personal lives (Vlačić, 2013). Amazon could accomplish this by outlining rigid work hours so that employees do not feel pressured to attend to work-related things (such as emails and calls) in their private time (Vlačić, 2013).

Risks of Amazon not addressing them Should Amazon neglect to address these issues they face many HR-related risks. The unprecedented technologically-enabled work that Amazon operates with, allows employees to overwork themselves and can lead to a work overload that will take a toll on employees work-life balance (Vlačić, 2013). Consequently, this causes decreases in job satisfaction, emotional distress, burnout and adverse opinions of the company and its technological implements (Vlačić, 2013). Furthermore, this can become a burden to the organisation as costs regarding staff turnover, underperformance, lack of innovation and creativity, among other things rise (Singh, 2013; Lazar, et al., 2010). Poor personal/professional balance is correlated to numerous mental health and physical problems like; depression, alcohol misuse, unhealthy eating habits, nicotine addiction etc (Meenakshi et al., 2013). If Amazon neglect to focus on this issue, they will struggle with underperformance, low productivity and will be unable to retain talent.

Performance Management The issue and its impacts on Amazon As technological advancements have allowed companies to better gauge their performance management (PM) it has also created issues affecting performance management regarding big data. Amazon employees have detailed that through technology every aspect of their work is monitored and measured and that this has created an astonishingly competitive workplace. Coupled with Amazons 'Rank and Yank' outlook on performance management, in which the lowest-performing employees are dismissed yearly, the workplace within Amazon is immensely tense, unhealthy and selfish as employees work past their limits and hide ideas from each other. Performance Management is crucial to improving overall performance. Joining PM too big data provides a transparent outlook of cross-sectional data and both time series, enabling more reliable interpretation of fluctuations of productivity over and in divisions (Brown et al., 2018; Davenport, 2008). To best function, PM needs to be thorough and advancing, with less focus on quick goals that rank employees competitively with one another (Brown et al., 2018). Further, performance management can reduce the competitive nature between employees and create a culture focus on teamwork (Brown et al., 2018). PM should offer feedback through methods that encourage employee motivation and enhancement to better retain staff (Brown et al., 2018). In a company such as Amazon joining performance management and data analytics is deeply beneficial. Stronger performance as a posed to competition is found in 65% of companies that have a people analytics culture, as performance is better understood and therefore better predicted (CIPD, 2018). However, management should be cautious when interpreting multiple factors and should understand that relationships, for example, is an unclear variable that will affect the result (Davenport, 2008). This indicates that Amazon needs to shift to a big data performance management system to dissuade employee ranking and dismissal. The data that is collected can be used to encourage employee development and training rather than be used as a means of fear motivating. Recommendation for how Amazon can address these issue The primary actions that Amazon can take to address the issues spoken about and successfully create a performance management plan that is data-driven are detailed below:

(Lussier and Hendon, 2015) As a company, Amazon must be committed to a culture driven by data to emphasis the benefits of decisions-making being data-driven (Pugna, et al., 2019). HR needs to regularly monitor and manage this, focusing on advancing, growing and encouraging employees additional to promoting a collaborative culture (Pugna, et al., 2019). Risks of Amazon not addressing them

If Amazon neglects to address this issue, it has the potential to lead to difficult legal implications. Amazon could be faced with lawsuits from employees emanating from negative performance management. Amazon needs to be able to display an impartial performance management system if Amazon is unable to do so there are potential financial repercussions as a court could rule that employees are entitled to back pay, court fees etc (Lussier and Hendon, 2015). More urgently the current performance management system is failing employees as it is causing anxiety, emotional distress or apathy and turnover as a result of the lack of stability the current performance management system offers (Lussier and Hendon, 2015). The absence of suitable performance expectations, rewards and objectivity pose a risk to Amazon not only financially but culturally as well. Amazon is well placed to gather and utilise big data, however, should remain wary of privacy concerns concerning private data (EY, 2014). Amazon needs to additionally show caution when sharing possible data to and from various places given that there are diverse privacy laws throughout the globe (EY, 2014).

Workplace Mental Health The issue and its impacts on Amazon Amazon additionally struggles with the level of stress employees feel and employee burnout. As previously mentioned the work environment within Amazon is highly competitive and tense, this can lead to employee burnout as employees do not have sufficient time or place to recuperate from the incredibly stressful work environment. This causes retention issues for Amazon as employee turnover is increasingly high. Employee stress-related burnout is ordinarily induced by extended work hours, unreasonable work expectations, performance fear, doubt, feeling undervalued, accelerated transformation, intimidations, failure, unworkable deadlines, employment insecurity, monitoring, among others (Jankome et al., 2013). As employee burnout due to stress affects performance and raises costs, in 2015 employee burnout amounts to over $300 billion globally (Bretland and Thorsteinsson, 2015). the effective management of employee burnout and stress would enable Amazon to increase retention, talent procurement and create a stronger foundation for the culture of the company (Harnois and Gabriel, 2000). (Jankome, Mangoriand, Ritacco ., 2013). Amazon's current practices are increasing the likelihood of stress and burnout as the current culture is tense and stress-driven. Amazon needs to reform its culture to create a healthy, stable work environment. this can benefit employees work, performance, mental health and overall wellbeing which in turn benefits employment and economic development (Harnois and Gabriel, 2000) (WHO, 2010).

Recommendation for how Amazon can address these issue Strategies that Amazon can use should occur in three parts. This report advises that Amazon work on the following: -

See too performance management and workload issues, particularly as these are reasons for stress and burnout (Jankome, et al., 2013): - Restructuring  jobs and outlining more defined expectations - Redesigning the workload system to afford better management and reasonable deadlines. - Potential structural change - Providing training and development for employees - Offering seminars on topics to help employees perform better. Eg, time management

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Offering a method of systematic recognition to employees Enforcing healthy, standard working hours

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Offering physical fitness programs, as exercise can deter burnouts as it improves employees physical and mental health(Bretland and Thorsteinsson, 2015). - Offering sport and fitness activities (yoga, football, cycling) - Offering team sports activities to additional foster a teamwork culture (football, soccer, quidditch)

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Mental health awareness should be a formative part of the workplace culture as being knowledgeable about these issues will allow employees to better see red flags and address unhealthy issues. - Having a Mental Health board to champion related projects - Monitor and measure stress burnout indicators (turnover, absences, surveys) - Offer meditation, mindfulness, relaxation methods - Offer counselling (Harnois and Gabriel, 2000)

Risks of Amazon not addressing them Stress is an expected component of working for any organisation, however, Amazon employees are enduring unacceptable levels. As an organisation Amazon needs to purposefully reduce the level of stress its employees are facing. If Amazon neglects to address this it will further impact staff turnover, absenteeism, decreased performance, workplace accidents, mistakes and difficulties with the acquisition of ‘talent’ (Jankome et al., 2013.). Additionally, employees could be placed in emotionally traumatic situations that cause both physical and mental health illnesses (Canada Life, n.d.; WHO 2000) (Jankome et al., 2013). Physically employees will experience lethargy, sleeplessness, weight gain, nicotine addiction and excessive alcohol consumption (WHO, 2010). The mental health implications are depression and possible self-harming or suicidal behaviours or thoughts (WHO, 2010). Should Amazon not seriously address the issue of their work-place culture the health of their employees will suffer which will inevitably cause the company to suffer, therefore this should be a priority for the company.

Conclusion Amazon has grown exponentially over the last decade and through the advancements in technology have become a household name globally with founder Jeff Bezos becoming the ‘Richest man in the world’. However, despite their success, Amazon struggles with contemporary management challenges such as stress and burnout in the workplace, managing performance and mental well-being in the workplace. This report detailed these issues and analysed the risk these issues pose should they be neglected and offer recommendations as to how best to resolve the aforementioned challenges. If Amazon neglects these issues the future workforce of Amazon will likely be a revolving door due to high turnover, with large negative effects on employees and low performance and productivity. It is therefore vital that Amazon considers the recommendations offered and reflect on what it is they want the future workforce and culture of the organisation to be.

References Al- Saidi, R. (2015) The Impact of Advanced Technology on Work-life Balance for the Administrative Staff at UNRWA-Gaza Field Office. Unpublished MA thesis. The Islamic University of Gaza. Gaza. Bretland, R, & Thorsteinsson, E. (2015) ‘Reducing workplace burnout: The relative benefits of cardiovascular and resistance exercise’. Available at: https://www.researchgate.net/publication/274712173_Reducing_workplace_burnout_The_rel ative_benefits_of_cardiovascular_and_resistance_exercise Brown, T, O'Kane, P, Mazumdar, B, & McCracken, M. (2018) ‘Performance Management: A Scoping Review of the Literature and an Agenda for Future Research’. Human Resource Development Review. Available at: https://www.researchgate.net/publication/327897940_Performance_Management_A_Scoping _Review_of_the_Literature_and_an_Agenda_for_Future_Research Canada Life. (n.d.) Burnout Response. Available at: https://www.workplacestrategiesformentalhealth.com/managing-workplace-issues/burnoutresponse IPD. (2018) People Analytics: Driving Business Performance with People Data. Available at: https://www.cipd.co.uk/Images/people-analytics-report_tcm18-43755.pdf Davenport, T. (2008) The Rise of Analytical Performance Management. Available at: https://www.researchgate.net/publication/255645874_The_Rise_of_Analytical_Performan ce_Management/citation/download EY. (2014) Big Data. Changing the Way Businesses Compete and Operate. Available at: https:// www.ey.com/Publication/vwLUAssets/EY__Big_data:_changing_the_way_businesses_operate/$FILE/EY-Insights-on-GRC-Bigdata.pdf Harnois, G, & Gabriel, P. (2000) Mental health and work: Impact, issues and good practices. Available at: https://www.who.int/mental_health/media/en/712.pdf Jankome, P, Mangoriand, M, & Ritacco, G. (2013) ‘The Impact of Stress and Burnout on Employees’ Performance at Botswana Power Corporation’, Interdisciplinary Journal of Contemporary Research in Business, 5(6), pp 795-821.
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