BUS 475: Business and Society

Corporations have had to evolve to meet the social demands placed on them by consumers and stakeholders. Large businesses are achieving enormous financial success and society is demanding that they adhere to intense and well defined ethical guidelines and that they use their corporate power to influence and enhance society. Corporate power refers to the potential that corporations possess to influence the economy, society, and the government with their resources and goals (Lawrence, 2017). Society is not only placing more demands on corporations to act responsibly and to dig deep and give back, the up and coming workers are putting pressures on corporations to relax their corporate mindset to see employees as individuals and develop a company dynamic based on accepting diversity and instilling inclusion of all employees at all levels.

Amazon Company Nature

Amazon is an online retailer and supplier on online business services. Amazon is ranked number two, just under Walmart as the largest retailer in the world (Carbonara, 2018). Amazon maintains on online presence that has yet to be matched by Walmart; while Walmart continue to top Amazon with the standard brick and mortar presence that Amazon lacks. Amazon strives to be everything to everyone with access to the internet. They are a host to millions of third party sellers and have built a reputation for swallowing up their competition in order to provide more to their customers. Amazon buys smaller companies that were providing goods or services that they wished to provide. Walmart was topping Amazon with their grocery sales Amazon acquired Whole Foods in order to be able to compete. Their progressive mindset even allows them to make money off of their strongest competitors. Netflix is a major competitor for Amazon’s streaming services, and while it seems that Netflix continues to have the advantage, Amazon was able to leverage their share of Netflix profits by providing Netflix with access to their superior cloud service platform. A platform so trusted that they provide cloud access to the Central Intelligence Agency. Amazon has emerged as a master of business partnerships that blur the standard lines of competitors and partners. There is no doubt that Amazon is a powerful corporation, and a worldwide presence they still have issues from external elements that can affect the future success of this giant.

Walmart as a competitor

Walmart is the largest retailer in the world and they are not slowing down. In the past, Walmart was the top retailer because of their brick and mortar presence. With the emergence of Amazon as an online super retailer Walmart had to take a step back, regroup, and focus in a bold new direction. In 2017, Walmart began to acquire many online retailers in a focused effort to provide real competition to Amazon. Their recent purchases include the following e-commerce companies: Jet. Com, Bonobos and Flipkart which was the largest e-commerce company in India. Amazon’s most recent acquisition of Whole Foods for $13 billion has kept Amazon and Walmart as very close competitors. The sheer enormity of Walmart and Amazons recent acquisitions serve to further show that the companies wish to not only blur the lines between tradition brick and mortar retail but in every retail aspect known (Carbonara, 2018).

Delivery Expenses

Amazon pushed their way into the top e-commerce retailer but also provided not only completion, but a much needed boost to shippers. Amazon Prime is a membership that offers free two-day shipping on qualified purchases. Free two-day shipping was the start, but now, in many areas same day delivery and two-hour delivery are available. The endless growth of Prime memberships and deliveries have created a financial boom for smaller courier services, but has also led to a shortage in delivery drivers. Indeed.com in reporting a 200% increase in job postings for delivery drivers since 2015. This has been great news for the delivery drivers with increased demand comes increased pay and benefits. Even with all the of the extras offered to delivery drivers there is still a shortage of workers (Sasso, 2018). Amazon continues to seek help from smaller contractors for delivery, but has also led a major push into Drone deliveries. Amazon has been pushing for drone deliveries for years they initially met with a great deal of resistance from the FAA. Amazon chooses to ignore the negativity and continue to push forward their dream of drone deliveries and have recently been granted a new patent from the U.S. Patent and Trademark Office (Shaban, 2018). The patent is for drones that can actually respond to human gestures which Amazon hopes will continue to have Drones viewed in a more positive light. As Desjardins (2018) illustrated, Amazon is trying to lead the way for drone deliveries in the United States. Some places have already accepted drone deliveries, in 2016 Domino’s delivered their first pizza by drone in New Zealand. In the United States the dream of drone deliveries is mired in red tape and legal obstacles and consumer mistrust. Amazon, in 2017, made more than five billion deliveries. The use of drones would not only allow this number to increase, but would substantially lower shipping costs for the e-commerce giant. While drone use is still a dream, it is important to note that it would not detract from the shipping boom that has already been established. The reality of drone deliveries is slow to evolve but Amazon is pushing forward with the same intensity that launched them as an online retail master.

Amazon Stakeholder Influence

Ferguson (2018) detailed that Amazon is committed to maintaining their corporate social responsibility interests of their primary stakeholders. The most important stakeholder group to Amazon, the company that has a customer centric model at the core of their business plan is the customers. The two other stakeholder groups that Amazon most responds to are the employees, and the communities that Amazon reaches. Continuing to represent their stakeholder’s interests keeps Amazon in the top position and an online retail leader.

Customers

The customers are Amazon’s most important stakeholders; their happiness is at the core of Amazon’s mission statement. Their focus remains on competitive prices, superior online security, convenience. In response to this stakeholder’s desires Amazon keeps pricing competitive and fair with sophisticated market based pricing strategy software (Ferguson, 2018). As previously discussed, Amazon’s online security is superior enough to entice the CIA to be loyal customers and a contract that was quite lucrative for Amazon. Amazon is driven to continue to find ways to deliver packages faster and more efficiently to keep customer convenience at the forefront of evolving business practices. By keeping the customers happy they can continue to enjoy the financial success that they have grown to expect.

Employees

Amazon employees influence the organizations financial performance because they are the heart of the competitive advantage and Amazon’s organization culture. Amazon’s corporate culture pushes their employees to break traditional models and concepts and to bring new ideas and practices into practice to keep the company competitive and progressive (Ferguson, 2018). Employees are essential to success, their input direction affects Amazon’s financial performance.

Communities

Amazon is very aware the communities are largely responsible for how customers view Amazon and their goods and services. One major way that Amazon appeals to the community stakeholders is through their AmazonSmile program. AmazonSmile is a website that is operated by Amazon and works like their regular website, but donates 0.5% of the purchase price of the products to charitable organizations that the purchaser chooses (Amazon.com). When Amazon supports a community or a charity they are giving back. When communities see an actual difference made by a company they are more likely to view the business as favorable, which directly increases purchases leading to more success for the company.

Amazon Controversy

As stated above, Amazon not only values the input and ideas of their employees but recognizes their contribution of this major stockholder group for their financial influence towards the success of the company. However, that does not imply that the employees feel as appreciated as Amazon states their importance. Jeff Bezos, the founder of Amazon, has a well established reputation as a rigid and demanding boss. As Haring (2018) reported the employees of the Washington Post recently submitted a letter demanding more competitive pay, improved retirement plans and a more generous sharing of the wealth Bezos enjoys with the people that are directly responsible with creating. According the letter of demands submitted with over 400 signatures Bezos had:

Amazon founder, Jeff Bezos, maintains a more traditional view of employer/employee relationships. He has been called a very rigid and demanding boss with old fashioned ideas that the paycheck is all the reward employees need. Bezos does not invest a great deal of importance on the newly established healthy and happy work culture. In spite of the harsh work culture that Amazon has become known for, the company continues to grow and thrive financially. Company culture is a relatively new focus in the business world and has gained popularity with the success of Google and the employee perk based mentality that seems to be lacking at Amazon. While Google appears to be the good parent to Bezos tyrannical nature, the numbers do not lie. Amazon still holds the number two spot for the world’s largest retailers, right behind Walmart who also had their share of employee grievances. The numbers do not seem to inspire a change in company culture, but with the emergence of younger workers as older workers retire these companies might find they are being forced to make substantial changes to entice and keep new employees.

• Offered a paltry $10.00 a week pay increase
• Froze the existing pension plan and offered a one percent 401k match
• Established in indiscriminate layoff policy
• Ended severance pay for people facing layoffs
• Demanded that laid off employees waive their legal right to severance payments

Becoming a Fortune 500 company takes work, dedication, focus, drive and a little bit of luck. Maintaining the balance necessary to maintain peace with the primary stakeholders is fundamental for continued growth and success. The main purpose of a business is to make a profit. It is up to the business owner and the stakeholders to determine how much profit and how these profits are distributed. Viewing employees as a valuable resource instead of the means to the end could influence company culture in a positive manner. When it seems the business owner possesses the Midas touch, and despite any missteps, the company continues to grow; it is at this time that the owner should remember the lesson in the immortal words of Ben Parker to his nephew, Peter, “With great power comes great responsibility.”