Amazon Inc.’s Performance and Development Framework

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Introduction

Amazon Inc. is among the most reputable technology-driven companies in the e-commerce world, serving a global clientele. The tech-based organization has diversified its operations to include artificial intelligence, cloud computing, and digital innovations (Castelli et al., 2017). It has also invested significantly in high-level performance management systems within its human resources management function (DeRooij et al., 2019). This paper provides a comprehensive analysis of Amazon Inc.’s performance and development framework.

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The Performance Management System’s Elements at Amazon Inc.

Performance Measurement

Amazon Inc. has a robust performance measurement strategy that entails collecting data, establishing information systems, and defining metrics and indicators. The technology company has a focused data-driven model, which allows the management team to evaluate its workforce’s productivity and job quality (Zhu & Liu, 2018). The enterprise utilizes the stack ranking approach to rate its workers against each other in yearly reviews. Poorly rated staff members are then assigned to a performance improvement scheme or fired instantly. The company usually computes and categorizes each aspect of a team member’s productivity, from the earliest phase of the onboarding procedure. Amazon Inc. also treats its workers as data subjects in every respect and retains laborers if they attain excellent performance.

Quality Improvement Process

Amazon Inc. has a comprehensive approach to the quality improvement process that incorporates change management, continuous learning culture, and policy improvement through data-oriented decision-making. The human resources function undertakes employee evaluations to assess their commitment to ongoing learning and improvement (Castelli et al., 2017). Amazon Inc. utilizes a three-month PIP (performance improvement plan) to assist team members to move in the right direction. Furthermore, the organization uses the information collected from data management tools to make decisions that promote customer satisfaction while enhancing the employees’ productivity (Zhu & Liu, 2018). The company’s CEO also uses the Six-Sigma model to improve it operations. The aforementioned change-management tool helps ensure employees offer the best consumer experience at friendly prices.

Performance Standards

As a reputable technology-giant firm, Amazon Inc. employs strategic performance standards that involve communicating expectations and workers’ responsibilities, selecting indicators, identifying relevant standards, and defining targets and goals. Examples of employee performance metrics assessed by the company include customer service quality, client gratification, and number of consumer interactions. The tech-based entity has a clear policy centered on providing the best customer care experience to its broad consumer base (Zhu & Liu, 2018). Amazon Inc’s employees are expected to observe high ethical standards in their duties while being friendly to clients (Franco‐Santos & Otley, 2018). Some of the enterprise’s job productivity standards include personal accountability, employee commitment, professional development, and workers’ creativity and innovativeness. The management team communicates effectively to the firm’s workers regarding the expected performance standards while maintaining the demands of the outlined indicators of performance, such as quality customer service and commitment to continuous improvement.

Reporting of Progress

Amazon Inc. has a well-defined progress reporting model that encompasses analyzing data, developing an effective reporting cycle, and executing data feedback to the management team, staff members, and policy team. The entity employs a data-driven method, typified by relevant metrics to measure its employees’ productivity while integrating staff-ranking models based on various parameters (Zhu & Liu, 2018). Furthermore, the enterprise integrates the information collected from consumers’ feedback into its decision-making process; this in turn, promotes organizational efficiency (Franco‐Santos & Otley, 2018). Amazon Inc. utilizes the ongoing feedback approach, facilitated by its “Anytime Feedback Tool,” an internal platform, which allows workers to critique or praise colleagues in its performance management model. The firm also uses the annual continuous feedback procedure to promote its employees’ performance.

Training and Development at Amazon

Amazon Inc. is firmly committed to developing its workforce through the provision of relevant skills and competencies. The company ensures that its workers participate in continuous learning programs within and outside the company (Castelli et al., 2017). The organization typically initiates strategies that support its team members’ personal and professional development. For instance, the company has set aside $700 million to provide free proficiency coaching to workers who desire to advance their careers in in-demand, high-paying jobs, including cloud computing (“Training for technical skills,” n.d.). Furthermore, the Amazon Machine-Learning University enables employees to enhance their proficiency in machine learning technology. The company also offers a workplace environment, which fosters dignity and respect for every individual.

The Impact

The performance and development system at Amazon contributes significantly to its success by enhancing efficiency in its day-to-day operations. For instance, Amazon’s performance standards help establish compelling productivity levels among employees in their commitment to delivering excellent customer service and attaining the entity’s vision and mission. The quality improvement policies at Amazon Inc. help enhance the organization’s performance index by eliminating wastage and reducing operational costs, thus promoting organizational efficiency.

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Strategies for Improvement

Amazon Inc. can improve their performance and development model by implementing advanced approaches to its performance measurement approach. The company typically uses the stack ranking procedure to rate its employees annually. Although useful, stack ranking is linked to several drawbacks, including high turnover and increased employee distress. Amazon Inc. can adopt the “Objectives and Key Results” (OKR) approach used by Google Inc. to review its team members. The OKR process promotes accountability within the workforce, enhances measuring and tracking workers’ progress, and fosters strategic alignment. The organization can also ameliorate its performance management procedure by implementing the midpoint workforce performance check-ins and organizing vis-a-vis meetings with employees.

Conclusion

The performance measurement strategy at Amazon Inc. entails gathering data, establishing information systems, and defining measures and indicators. Its quality improvement process incorporates change management, continuous learning culture, and policy improvement through data-oriented decision-making. Amazon Inc. has strategic performance standards that encompass communication of expectations, selecting indicators, identifying relevant standards, and defining targets and goals. The organization can improve its performance and development model by integrating advanced productivity measurement approaches, such as the OKR approach, into their review system.

References

Castelli, M., Manzoni, L., Vanneschi, L., & Popovič, A. (2017). An expert system for extracting knowledge from customers’ reviews: The case of Amazon. Com, Inc. Expert Systems with Applications, 84, 117–126. Web.

De Rooij, M. M. G., Janowicz-Panjaitan, M., & Mannak, R. S. (2019). A configurational explanation for performance management systems’ design in project-based organizations. International Journal of Project Management, 37(5), 616–630. Web.

Training for technical skills. (n.d.). Amazon. Web.

Zhu, F., & Liu, Q. (2018). Competing with complementors: An empirical look at Amazon.com. Strategic Management Journal, 39(10), 2618–2642. Web.

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BusinessEssay. 2022. "Amazon Inc.'s Performance and Development Framework." August 3, 2022. https://business-essay.com/amazon-inc-s-performance-and-development-framework/.

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BusinessEssay. "Amazon Inc.'s Performance and Development Framework." August 3, 2022. https://business-essay.com/amazon-inc-s-performance-and-development-framework/.