Amazon Company: Management of Human Capital

Introduction

Critical analysis refers to the fundamental process intricate in any hypothetical work. It entails firm thinking, the application of coherent reasoning and consistent thinking. The process also involves the deconstruction of different concepts and texts that the individual reads. In the context of management, critical thinking regards careful and detailed assessment of a situation. Organizations utilize critical analysis to determine whether or not an employee is performing to their complete potential and capacity. Critical analysis begins with critical thinking. The approach helps in determining whether an assertion is true, partly factual or fabricated. Critical thinking to arrive to critical analysis results in skills that can be learnt, understood and applied in a specific area in an organization.

The awareness of an individual’s dominant purpose in an organization and basing the functionality on this knowledge acts as a guide to all matters that demand making crucial decisions. This has been in existence for centuries. Rational planning is recognized as the key function of corporate executive by the classical and modern management theorists. Henri Fayol (1841-1925) supported that predicting and preparing were central management functions in guaranteeing that a company accomplished its objectives (Fayol 1949). Fayol added that it is essential to direct the functions of management to ensure that strategies were scrutinized and appropriate measures taken to improve performance. Fredrick Taylor also asserted that managers were to be the accelerative ‘planners’ and supervisors of activities.

On the other hand, the employees on the shop-floor are the ‘doers’. According to Taylor, humanity in the context of the workplace can be systematically categorized into two classes. A substantial number possess the capability to act as ‘minds’. The category ‘scientifically’ conceives production processes and improves them. The other category which constitutes the majority simply contributes as ‘hands’ in the roles designed for them by the ‘minds’ category. My essay addresses management issues and strategy in an Amazon warehouse setting. Corporate planning in view of the two categories in this context appears to be reliant on prior suppositions regarding individuals, leadership and hierarchy. Corporate planning particularly regards the apparent necessity of hierarchy in the composite circumstances that surround corporate settings (Blaug 1999).

Main Body

The idea of strategy in the contemporary management practices draws comprehensively on the understanding of employees, leadership and hierarchy. It is observable as simply sort of increasing extension of operational planning.

Summary of case in an Amazon warehouse

Amazon’s Swansea warehouse is among the largest in the United Kingdom measuring 800,000 square feet (Cadwalladr 2013). The company has more than 100 items on its website. Hundreds of other items are not placed on the internet. Cadwalladr gives her experience as an employee in the giant outlet in Swansea. She states that the outlet receives more than 450,000 orders when business is good. The implication is that both the employees and the managers are overstretched. During the festive season, the company receives more than 3.5 million orders in a single day. Handling such a huge amount of orders is a challenge to the organizational commitment in balancing between customer service and the wellbeing of the employees in terms of working for long hours.

Currently, there are four shifts that work at the Swansea outlet. Every employee works for fifty hours per week. The hours are spent in hand-picking and packing the items as ordered by the customers. The public has labeled the practice as being ‘Amazon’s elves’. The employer is infamous for paying the employees minimum wage yet the employees are pushed to the edges of the European Union working directives. The junior employees are sacked when they take three sick-leave breaks in any 3-month period. According to Cadwalladr, a book authored by Brad Stone indicates that Amazon avoids paying taxes despite the high returns the company gets from its sales and exploitation of employees.

When Cadwalladr was employed by the company through a Swansea employment agency, she sought to investigate the company from within. She is a journalist by profession and wanted to investigate whether or not the allegations leveled against the company are factual as an undercover reporter. Cadwalladr discovered the real reason behind the success of the company. The company is excellent in all its online transactions.

When a customer clicks to buy an item online, the employees are expected to ensure that the item is timely delivered. The company has mastered the art of sorting the myriad of chaos generated by storing millions of items. The company has an elaborate strategy of figuring out how to deliver items to the customer timely and reliably defeating competition from rivals. Cadwalladr states that the employees not only pick and pack hundred-thousands of items in a single day but also the items are the right ones and sent to the right clients. The company never fails to meet any order.

Summary of conventional managerial explanation

In recent times, Amazon human resource function has been revolutionized to reflect on the rapidly changing employment arena. The high rate of employee turnover impacts even the most successful companies. Existing companies are rapidly changing the view regarding employees. Companies are actively engaging employees in decision-making processes. This way, the employees feel part of the company and eventually become loyal to the endeavors of the company. The aspect is important in that the employees become innovative to the benefit of the company. However, failure to conceive employees as an asset that helps the company attain its objective is detrimental to the success of any company (Grey 1999).

Summary of the critical perspective (Marxism)

The Extended Design School of thought regarding strategy and positioning of an organization in business remains the most prevalent prototypical strategy formulation process. It is considered as the rational model of strategy. The model treats strategy as a dialogue and textual flow of ideas and reasoning. The approach analyzes how official strategies of organizations and managers reflect leading strategic discourses (Knights & Morgan 1991). It also examines the knowledge and authority relations with the employee embedded in the dialogues. The view of Carl Marx offers an insight into how the Amazon management deals with strategy development in regard to profitability and market leadership.

The claims for managerial authority perpetually rest not only on the de facto status of the manager in the organization but also on implicit ‘work of managing’. In this regard, the human capital is an essential part of organizational success. However, most organizations employ top managers with capitalist ideologies to ensure that the company is financially successful. Amazon implements the rationalist approach in conducting its business in view of the employees. The objectives of the company are subdivided into narratives of strategy. The managers are encouraged to adopt appropriate roles in guiding the employees in performing their tasks (Hales 1986).

In analyzing the Amazon profitability strategy, Marxist approach indicates that the entrepreneurs use the financial endowment not only to gain market share but also to assert its authority on the employees. The employees in the company are not adequately paid for the work they do. Marx conceived that work is essential to human existence whether physical or mental. The hierarchical structure of an organization extends differences among employees. This indicates the splitting-up of mental (mind) and manual (hands) labor.

Summary of the critical explanation (ideology and managerial power)

In the contemporary business field, technology is essential in delivering to customers. Irrespective of the nature of business, technology in terms of production and distribution remains an essential part of corporate profitability. In the absence of production technology, every individual is a potential employee. However, given the role played by knowledge, expertise and competence in the increasingly competitive business world, employees are practically useless in the absence of appropriate machines and technology. Machines and accompanying technology are expensive to attain and maintain (Alvesson, Bridgman & Willmott 2009). Financially endowed individuals who can afford the technologies and machines can hence dictate the terms of employment. Consequently, the working conditions and wages continue to dwindle as is the case in Amazon. According to Marx, this is exploitation.

Amazon has exercised capitalism for years. The top management harbors immense managerial power. The managers use the power to influence the terms of employment for junior employees. The availability of advanced technology in the company creates room for modern capitalism. The information technology infrastructure employed by the company reduces the number of those required to effectively run the company while the majority possess low or no skills at all. The individuals with high specialty and extensive training find themselves at the cream of the organizational structure with immense influence in running the establishment.

The power given to these individuals by the management presents them the opportunity to exploit the unskilled employees. Departmental managers harbor the authority to dismiss employees who take three sick leaves in three months. This translates to employees reporting to work despite being sick to avoid sacking. The balance of power does not exist in the company hence more work with little remuneration packages.

The ideology applied by the management oppresses the employees. The employees are not engaged in decision-making. The top management considers the employees as human capital that only delivers manual labor. From a Marxist perspective, the strategy segregates the Amazon society into workplace social classes. This approach to management is different from a variety of other management approaches. Labor power in the context of Amazon is a commodity considering the wide range of activities necessary to accomplish the objectives of the company. The use of labor power is no longer systematized according to the needs and wishes of the employees. It is systemized according to the needs of the employer. The company has been observed to possess special and enduring interest to belittle the commodity (Magdoff 2006).

The management system by Amazon, for example, is different from the Contingency Theory of management. Contingency Theory is perceived as management by exception. It operates on the appreciation that possibilities occur. The theory asserts that the things that are going right need not be managed. Instead, the exceptions are managed. Generally, the exceptions are expected to be few. Consequently, the employees are granted more empowerment. The approach allows the management to concentrate on other areas that actually require improvement. The employees are engaged in decision making and have more responsibilities. The terms of employment are better compared to capitalist approach (Fournier & Grey 2000).

Working individually and together in organizations is determined by the organizational culture founded on how the organization treats its employees. Amazon management ought to examine its current management approach and adopt postmodernist management approach. The approach emphasizes rationalist approach to strategic discourse combined with reconfigurationist model. It entails majority of the essential features that many executives are not aware of. These elements are contemporarily considered universally pertinent in the formulation of strategies that emphasize employees as human resource assets (Grey & Willmott 2005).

Conclusion

In this essay, I have critically analyzed the management of human capital in Amazon in view of management models. The analysis illustrates that Amazon is an exploitative employer. Despite the financial endowment of the company, the management perennially exploits the employers by prolonging work time while paying minimum wages. This analysis is essential for the top management of the company as it reflects the weaknesses that require to be addressed urgently.

The reviewing of the organizational culture of the company is fundamental to negate imminent employee crisis. This is in consideration that many organizations are rapidly creating employment opportunities gradually becoming employers of choice. In coming years, Amazon is likely to face labor force crisis considering that prospective employees are avoiding the engagement with the company. Employees are an essential part of an organization. Their contribution should be valued by the employer by affording good working environment as well as competitive packages. Engaging employees in decision-making process makes employees commit to the endeavors of the company. Engaged employees are often innovative and perform to deliver the objectives of the organization.

References

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