Corporate Level Strategy
A Critical Evaluation of Amazon Inc.’s Corporate Level Strategy
Corporate level strategy refers to a company’s game plan to attain long-term goals and realize its vision. The top-level management develops this strategy in consideration of the organization’s growth, opportunities, and threats. The corporate strategy formulation considers the organization’s available resources and the prevailing conditions in the company’s macro environment to determine the best approach to create a competitive advantage (Hitt et al.,, 2012). This report evaluates the implementation of Amazon’s corporate strategy, which is classified as concentric diversification. Amazon is the world’s leading e-commerce retailer specializing in the exclusive sale of different product lines on its e-commerce website. Furthermore, the company offers services such as cloud services, data analysis, and digital services. The company adopted a cost leadership strategy to create value and was ranked the most valuable company in 2019.
Concentric diversification entails the expansion of a firm’s business operations by incorporating additional products. Amazon specializes in the exclusive retail of products through its e-commerce website. The company is also involved in product logistics, delivering the products to the final customers (Cloud, 2011). The company diversified its operation by expanding the category of commodities in which it trades. At its onset, Amazon began as an online bookstore. Over time, its catalog expanded to include household goods, furniture, convenient products, etc. The company recently penetrated the art market through the arts category launched on its website. On the same note, the company launched Amazon Supply in 2012, which specializes in providing industrial and scientific components and supplying maintenance and repair parts.
Secondly, Amazon implements a concentric diversification strategy by specializing in technological goods. Examples of technological services offered by the company include Amazon analytics, application integration, and AR&VR. Amazon analytics constitute Amazon Athena, an interactive query service that facilitates data analysis on the Amazon platform using the standard SQL language (Cloud, 2011). This service is convenient because it only requires customers to pay for the servers used. Recently, Amazon launched “Alexa,” a virtual assistant that helps users with simple tasks such as web searches, searching for songs through the music folder, etc. In doing so, the firm is competing with Apple’s virtual assistant “Siri.” In the future, Amazon intends to issue medical services through Alexa, whereby customers will describe their symptoms to the virtual assistant to diagnose their illness. Amazon also offers AWS cost management, a service that helps entities or project managers in organizing their budgets and resources based on their specific needs.
Recently, Amazon launched Amazon Go, a service that allows customers to purchase from its physical store without checking out from the cashier. This service was aimed at resolving the challenge of long queues experienced by customers when shopping from brick and motor stores (Amazon, 2015). In enhancing the logistics service, amazon intends to launch drones to deliver products to customers, specifically in the US. This service will be launched in specific markets due to the various aviation laws in different nations. To enhance service quality, Amazon launched Amazon Prime in 2005, which offers free shipping for customers located in the US market. Moreover, it offers a flat-rate annual fee for perishable items purchased from the site. Amazon intends to invest in research and development to substantially diversify the technological products and services issued to customers. Moreover, the firm focuses on the provision of impeccable customer services in building good customer relations.
References
Amazon, E. C. (2015). Amazon web services. Available in: http://aws. Amazon. com/es/ec2/(November 2012).
Cloud, A. E. C. (2011). Amazon web services. Retrieved November, 9(2011), 2011.
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012). Strategic management cases: competitiveness and globalization. Cengage Learning.
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Question 
Organizational Research Assignment
This week the readings/video focused on Corporate Level Strategy.
Corporate Level Strategy
For this assignment I would like for you to identify a company (not mentioned in the text) that you are interested in learning more about. Once you have identified a company, I would like for you to do an write a 2-page double-spaced brief on their “corporate-level strategy”. Given the chapter’s focus on diversification you may want to focus on a large global organization where diversification may be easier to explain.
Suggested video:
- https://www.youtube.com/watch?v=isVsG6d9dmw