AMAZON AS AN EMPLOYER SHRM Case Study Solution
– An article published in The New York Times portrayed Amazon as a soul- crushing employer and a cruel place to work.
1. Does the people management strategy of care and compassion make business sense? How does the practice of keeping employees on the edge impact business in the short and long run?
2. Is Amazon’s employer brand as reported by The New York Times sustainable? Why or why not?
3. Are employees thriving under Amazon’s workplace policies, or are they just barely surviving?
Case Study Solution
1. Does the people management strategy of care and compassion make business sense? How does the practice of keeping employees on the edge impact business in the short and long run? (1000 words, 40 marks)
When it comes to maximisation of shareholders’ wealth, making business profitable and remain competitive, innovative, goal focused, market leader and accountable to money put into business by investors, people management strategy of care and compassion have no sense for a business organisation. Amazon, since its start of its operations till date, has grown tremendously and generated great return to its investors, thus making the company one of the best places for investors to park their money and win heart of customers in offering unique services and experiences. Strategy of care and compassion creates issue and become insensible for business growth.
Extra care and compassion have negative results that hamper employees’ personal and professional growth. Many times unnecessary concerns and worries for employees distract leaders in handling the situation and decision making. Many times, care and compassion becomes control issue for leaders. For instance, managers are not able to make strong decisions because they are concerned about employees’ reaction leading to difficulty in accomplishment of goals of the organisation.
Care and compassion reduces abilities of employees to handle difficult task and convert challenging jobs into opportunities of learning new skills thus hindering employees’ growth and reduction in turnover of the company as well as unsatisfied customers.
To an extent, care and compassion helps to increase the productivity of employees at work place but, when it comes to make the company most innovative in the industry and work in a dynamic environment, instead of being compassionate; aggressiveness, assertiveness, bold attitude towards new and challenging task, passionate to work 24/7 and capability to devise new ideas and convert into a successful becomes more important for profitability and survival of the business.
Constant empathic role of leaders lead to reduction in capability of employees to face new and unique challenges and adapt to changes required to remain market leader in the industry and also create compassion fatigue among employees.
It is very important for employees of business organisation to not only work hard and for long hours but also act smartly when it comes to fulfilment of wealth maximisation of shareholders. Care and compassion sometimes leads to unethical behaviour in terms of restriction of performing new and challenging tasks and accomplishment of tasks on time leading to losses to business organisations.
Innovation is key driver to success for a business organisation in the industry which demands for highly talented, workaholic, competitive and passionate workforce rather than a work force who seeks compassion and care from team leaders. It will hinder the process of continuous innovation and opportunity of employees’ professional growth thus leading to failure of business.
For a business organisation, the most crucial motivational factor that keeps them going on and on is the profit generated out of business operations in order to meet the expectation of shareholders and increase in valuation of company in stock market. Care and compassion does not generate profit and satisfy goals of shareholders. Hence it becomes sense less for a business to focus upon it. Investors look into financial statistics of company while investing into it rather than inculcation of care and compassion in corporate culture of an organisation.
How does the practice of keeping employees on the edge impact business in the short and long run?
In short run, practice of keeping employees on edge impact business positively in terms of increased in productivity, effectiveness, efficiency and thus overall profitability of the business. It will facilitate employees to take new challenges at work place, explore new business ideas, innovate, complete task on time and remain competitive among peers which is crucial for sustainability and growth of a business organisation.
It will foster employees to learn new things faster, improve morale, and a sense of achievement while performing task at work place. It will help managers to easily differentiate between most efficient and least efficient workforce in the organisation, thus enabling process of training and development more effective and sound in the organisation.
Overall performance of employees at work place will substantiate success of organisation. The organisation will be embraced with efficient pool of talents motivated to bring the company at number one position in the industry and increase its profitability.
It will facilitate eagerness among employees to collaborate, learn from their teammates and perform challenging tasks placed upon them in a fast changing global environment to become achievers who have the capability and will power to create history and pave the way of success for themselves and organisation as well.
It will increase accountability and boost coping abilities of employees at work place to remain confident, effective and efficient in accomplishment of tasks assigned to them. It helps them to focus on integration of their growth with organisational growth, work with little or no supervision and make them proactive and street smart.
However, in long run, practice of keeping employees at edge will impact business organisation adversely. Employees’ fear of inability to meet Expectations and standards set up by organisation on time will put employees at distress in long run leading to high attrition rate, low productivity and feeling of discontent among employees in the organisation.
Anxiety and fatigue pops out sometimes leading to depression and burnout due to long working hours, meeting deadlines, and exploring new ideas for business growth and competing with peer members for saving jobs. It reduces efficiency and performance of employees at work place, creates job dissatisfaction and work alienation.
Employees are not able to concentrate at their work, a sense of belongingness remains missing towards organisation and employees suffer from work life balance issues. Creativity is lost and employees feel demotivated and devastated while doing something new and unique for growth of organisation thus hampering innovation in the organisation.
Overall efficiency and productivity of organisation is hampered dramatically if practice of keeping employees at edge is followed in long run. It negatively impacts innovation at work place, puts sustainability of organisation in danger and reduces profitability of business.
Employees feel disengaged and find management insensitive towards their needs and requirements leading to distortion of talent pool within the organisation. Employees lose confidence in the company they work for and start focusing on self-fulfilment rather than organisational welfare. Employees start searching for opportunities outside the company and quit the job due to which many times organisations loose best talent and employees due to practice of this strategy at work force in long run.
2. Is Amazon’s employer brand as reported by The New York Times sustainable? Why or why not?
Amazon has been criticised for putting employees working for long hours, building pressure on employees through peer review system and promoting employees to criticise each other at work place. Work environment at Amazon is very competitive and pressure building where employees have to compete with each other and sabotage each other to survive at Amazon. However, Amazon as an employer brand seems to be sustainable as it has established itself as an employer brand for those people who are willing to work under pressure, learn and perform challenging tasks and foster constant innovation and creativity for future.
Work philosophy at Amazon is that employees have to work hard, smart and long and one cannot compromise on any of three. Employees’ motive at Amazon is to adopt challenges as an opportunity to grow, enjoy the work and create history in the world. Customer satisfaction and value creation for its customers through continuous innovation and customer support is the top priority of Amazon.
Corporate culture of Amazon demands from employees to use unconventional methods to generate innovative and solutions to the problems existed at work place in order to succeed in cut throat competition prevailing in the industry and attain market leadership.
Amazon as an employer suits those who are ready to take challenges in fast changing competitive environment, become forefront for technological innovations and are full of ambitions in terms of career growth & development, success achievement and wealth accumulation.
It works on the philosophy of facing extreme demands at work place instead of running away considering it as a problem for them but as an opportunity to career growth and technological advancement in their skills and capability.
It fosters an environment where people are enthusiastic to work on cutting edge projects with innovative ideas and solutions and ready to learn from their team members at work place who are thriving on meeting expectations of billions of its customers and achieve success individually as well as for the organisation. Amazon seeks for employees who shine under pressure and are high performers and strong emotional quotient.
It considers its employees as a pool of talent and facilitates training of employees to increase their capability and develop their personality. Its training program enables employees to understand what is being expected from them and get engaged with work culture at Amazon. It will facilitate smooth functioning of employees at work place as per the standards and norms set by Amazon and avoid conflicts.
Human resource activities such as training and development, performance appraisal, pay and perks are designed effectively and systematically to achieve corporate and strategic goals of Amazon such as continuous innovation and technological advancement to create value for its customers and increase revenue for the company.
Usually small teams are formed with main motive to reduce differences, promote self-management of employees and invest huge chunk of money in training and development of its employees. Company also promotes sharing of information inter and intra department level to promote creativity and learn things from each other to facilitate fast resolution and decision making.
Amazon’s policy to hire talented people from diverse backgrounds is the key to fulfil its objective of constant innovation and maintain competitiveness in long run. It considers talented employees as a source of competitive advantage and thus focuses to attract people who are innovative and have firm belief in Amazon. In order to attract and retain talent, it shares profit among its employees.
It offers more incentives to employees who serve the company for more than two years than new employees with a motive to retain such talents who are highly involved with organisation and reduce training cost. Company offers best pay and perks in the industry to attract talented personnel in the organisation. Performance based incentives and signing bonus are integral part of packages offered to its employees.
Performance appraisal is based on self-evaluation and peer assessment. Earlier before 2016, Performance of employees was ranked and those who performed worst were dismissed from the company. But now, company has changed this policy and started a retraining program called Pivot to train its underperforming employees and offer them a chance to improve their performance.
Company takes regular feedback regarding working environment from employees. It has daily question and answer feedback program called Connections to understand its work force and problems faced by them. It has ‘Forte’ an Employee review program in place which focuses on employees’ strength rather than their weaknesses and thus putting employees motivated positively towards the organisation.
Amazon plans to retrain its one lakh employees investing $700 million. It has plans to expand its training programs and adds new training programs to improve the quality of its work force and retain talented and future ready employees at work place to foster constant innovation, creativity and meet its commitments to become top employer brand in the industry.
3. Are employees thriving under Amazon’s workplace policies, or are they just barely surviving?
Employees are thriving as well as just barely surviving under Amazon’s workplace policies. Amazon is a technology driven company which is customer obsessed and innovation centric. Employees who are passionate about what they do at Amazon in terms of innovating new products and services to create history, earn big and become star performers of the company are thriving under Amazon’s workplace policies.
Employees who are ready to sacrifice their work life balance and enjoy career advancement by fulfilling extreme demands rising at work place are thriving not surviving in Amazon. These people are willing to work 24/7, reply mails sent to them in the midnight, highly enthusiastic, ready to take pain on behalf of the company to satisfy expectation of customers, meet high set standards of performance, ready to collaborate with work force, learn and adopt new skills, give innovative and creative insights, work on challenging and cutting edge projects, willing to accept challenging jobs as an initiative to grow and prosper in their career rather than problems and escape from it.
Employees who are deeply rooted with Amazon’s work culture and belief of work hard, smart, long, have fun and create history are advancing in their careers and prospering while working at Amazon. These employees enjoy working in an unconventional, competitive and fast changing environment with a motive to do out of box things for welfare of the company and customers and earn strong reputation in terms of huge pay and promotion.
Constant criticism of ideas and opinions of peers, attending late night meetings, sending feedback to others’ bosses anonymously to sabotage each other are some of the features which otherwise employees thriving at Amazon do not like but for the sake of success in their career and organisational growth, they feel correct to do so.
Effective training programs offered by Amazon to its employees on regular basis help in career growth and personality development of employees to accept new challenges and get adept to it.
There are various reasons due to which employees find that they are merely surviving under Amazon’s policies:
Employees at Amazon find they are surrounded with highly skilled and talented people who are extremely boosted to think creatively to overcome new operational challenges, devise innovative ideas to pave the path of success and meet the expectation of company and customers.
Cut throat competitive working environment creates huge pressure to perform and surpass their team mates to survive in the job. Long hours of operation create mental stress and anxiety sometimes leading to frustration and depression. Working even at vacation and constant overtime completely destroys work life balance and thus hampers personal well being of employees. Surviving Employees find no support from management with regard to work life balance.
Standards of performance set at Amazon are unexpectedly too high and unavoidable which creates pressure and distress among employees leading to job dissatisfaction and fear of job loss.
Culture of promoting unnecessary competition among co-workers and criticising ideas of peers in meetings prompts star performers to succeed in career and low performers to quit from the job. Company’s culture to not to include women in top management hinders female employees’ career growth and advancement which is against women empowerment guideline.
Yearly performance review process is based on rankings where managers discuss subordinates’ rankings. Employees are encouraged to criticise their peers by sending feedback to top management and low performers are thrown out of the company. However, Amazon has currently changed this policy and launched retraining program to give a chance to low performers to improve their performance and meet the expected standard.
There is a fear in the mind of old employees that they will be replaced by new and young employees as Amazon encourages to promote dismissal of old employees with more commitments in terms of responsibility towards family, parents due to which they will not be able to focus on work and contribute extra time to company as compared to young employees who have less commitments and more time to focus on work.
Management of Amazon is not sensitive towards employees who suffered from severe diseases such as cancer, miscarriages or some personal crisis and such employees are not given adequate time to recover and perform with their highest ability and are evaluated unreasonably on performance scale and are dismissed. This inhuman behaviour and work place policies hinder employees’ survival at Amazon and exhibit cruelty on the part of management’s responsibilities towards its employees.
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