Introduction
Building a solid and influential organizational culture is crucial for organizations that aim to establish business consistency and direction, guide informed decisions and actions, as well as encourage the workforce to reach their fullest potential. The examples of multinational corporations have been used by other companies to emulate their culture because their success was partly due to organizational culture. However, there is often more than meets the eye, and no organization has a perfect culture. In the case of Amazon, both current and former employees have linked the success of the company with its corporate culture, with the set of standards it has set being one to replicate. While Amazon’s culture is quite unique, it has its strengths and weaknesses, and the aim of this paper is to discuss them and make recommendations on how the management and leadership can change to facilitate engagement and create a culture of emotional intelligence and psychological contract.
Existing Culture at Amazon
The work environment at Amazon has been considered high-pressure, with some employees finding it challenging to work under strenuous circumstances. Nevertheless, the company has been showing tremendous growth and increasing business capacity for meeting the demands of the dynamic e-commerce market (Le, 2021). There are specific characteristics of the unique approach that Amazon takes within its corporate culture. The first trait is the writing culture, which is illustrated in the way that meetings are held at the company. Specifically, all ideas and opinions involved in business decision-making are documented with the aim to drive clarity during discussing resourceful information. During meetings, points are drawn from the documents and then evaluated regarding their usefulness. Employees are expected to spend a lot of time on enhancing and strengthening their claims instead of providing claims or ideas that add no value. Thus, open and even ruthless criticism of each other’s ideas during meetings was expected, with employees having to send feedback to the supervisors of their co-workers that they criticize.
Second, the organizational culture at Amazon encourages agility, which is illustrated in the company creating smaller technical teams that can maintain effective communication and avoid idea and information loss. Working within smaller teams, employees are expected to feel more significant and accountable compared to working in large groups that are complex to manage. Third, Amazon has used tenets for encouraging employees’ decision-making when they work in teams. The tenets tend to act as principles guiding the process of decision-making in cases during which team members face challenges. Moreover, tenets help make trade-offs, which entails choosing actions that matter the most (Le, 2021). Fourth, Amazon pushes its employees toward innovation and encourages them to think creatively and outside the box. The workers are expected to find answers to the arising issues and not let them stay unanswered. Finally, the startup culture is notable at Amazon as employees are expected to maintain the energy of pursuing excellence. Workers work as hard as they used to when the company was only starting to build a brand, thus maintaining consistency in the work culture.
Problematic Management Approach
Despite the uniqueness of Amazon’s organizational culture, the company has been subjected to some criticism. For example, in 2015, the New York Times issued an article commenting on the company’s approach to management, suggesting that Amazon has been implementing “an experiment in how far it could push white-collar workers to get them to achieve its ever-expanding ambitions” (Kantor and Streitfeld, 2015, para. 5). This means that managers often push their subordinates toward accomplishing goals that may not always be possible to reach. Coupled with ruthless criticism and the “hire to fire” approach, the management at Amazon can be considered greatly problematic.
Research on Amazon’s issues in management has shown that the actions that managers carry out often result in adverse outcomes. Specifically, investigators have found that the turnover in some of Amazon’s engineering units was over 50%, even though the company disputed this figure (Carmichael, 2022). Besides, there has been a catalog of numerous complaints from workers about unreasonable hours, below-market pay, and the overall toxic organizational culture. A Washington Post reporter mentioned that predictive schedules were often hard to come by at Amazon, drawing from interviews with the company’s employees. For instance, one engineer said in a Business Insider interview that his manager suggested taking a one-hour nap during his work shift and then continuing working until 2 a.m. (Hamilton, 2022). Other former employees shared similar stories of having to work unreasonable hours and that their managers expected them to dedicate themselves fully to their responsibilities.
The longstanding problem with the management approach related to handling paid and unpaid leaves as both blue- and white-collar workers were adversely impacted by it. There have been reports of Amazon employees around the country who have faced medical problems, and other life crises have been fired because the attendance software marked them as no-shows (Kantor, Weise and Ashford, 2021). In addition, doctors’ notes that workers provided vanished from the company’s databases; besides, employees struggled to reach their case managers because of the excessive automation of back offices. These reports from workers are evidence of the fact that the management approach at the company is not people-oriented, as individuals are seen as numbers and statistics and not people who hope that their needs are met and understood.
The increased emphasis on the culture of feedback presents another challenge to the management approach that Amazon has implemented because it provides a basis for creating a list of lowest-performing employees that would be let go from the company. With the introduction of the Anytime Feedback tool, employees are expected to send direct praise or criticism about their co-workers (Buckingham and Goodall, 2019). This feedback is given directly to managers, with the identity of the feedback provider being revealed only to the manager. According to Amazon speaks people, the tool has been established to provide a way to share feedback with managers in a way that is similar to having a one-on-one conversation (Buckingham and Goodall, 2019). However, the managers at Amazon do not acknowledge the fact that the practice encourages workers to be highly critical of each other, which facilitates excessive competitiveness. When managers get consistent reports about the lower performance of particular workers, they are expected to make decisions on letting them go. Instead of noting the lower performance of workers and encouraging their managers to implement measures for boosting it, Amazon chooses to increase turnover, which does not guarantee better outcomes in the long run.
It is notable that the majority of problems in Amazon’s management approach have been caused by the company’s dedicated focus on the customer experience and increasing the levels of client satisfaction. The company has invested in creating modernized package processing facilities that could meet the demand of shoppers for fast delivery and outpace competitors (Kantor et al., 2021). With this main goal in mind, Amazon failed to provide enough adequate resources and attention to how it managed its employees and whether it met their work needs. There has been severe criticism of how the company treated its employees – the efforts aimed at ensuring the safety at warehouses were inadequate, while the minute-by-minute performance monitoring did not enhance productivity. Instead, employees began sharing their dissatisfaction with the way they were treated, thus increasing the risks of unionization against the company.
Because the problematic management approaches at Amazon have been well-publicized and reported in business media outlets, the company has faced challenges when it comes to replacing the people that it lost. For example, when skilled engineers hear that Amazon expects its employees to work longer hours and for lower pay, it is unlikely that they will be willing to become new members of such time. Even though some level of employee is healthy and even needed for companies to refresh their culture and skills, the doubts that some potential employees may have regarding the culture of the company to which positions’ they apply may limit hiring success.
Human Resource Management Practices
HR management practices at Amazon align with the Strategic Human Resource Management (SHRM) theory, according to which all decisions on employees match the strategy of the company. Therefore, the human resource management practices at Amazon are required to go hand-in-hand with the specific organizational duties and business objectives. The focus of the company to meet its strategic objectives and overcome competition is reflected in its HR practices, which have entailed maximizing employee performance to the highest degree by setting specific standards that workers must reach. However, the record of the company in terms of its HR has not been impressive. Known as a white male-dominated company, Amazon has been criticized for its inability to maintain the long-term satisfaction and retention of its workers. It is a note on the lack of diversity as Amazon did not have female workers in top leadership positions.
Amazon’s key SHRM objective is finding and creating the right leaders with the help of training and promotion of the desired skills and qualities. Thus, the pressure is on the leaders to increase the organization’s success and market competitiveness. As an organization that is known worldwide, it has established rigid performance standards to guarantee success and profitability, which could be a source of employee disengagement and dissatisfaction. In terms of teams working at the company, Amazon has different HR policies for part-time and full-time employees. The conditions for part-time workers are less strict, which makes it easier for them to have a better work-life balance. There is a belief that the division in the approach to part-time and full-time employees could enhance flexibility at the company and make teams more productive. The high levels of performance have been dependent on the feedback system that encourages workers to either praise or criticize each other.
Drawing from the case study, the HR practices at Amazon are not effective enough for facilitating employees’ satisfaction and engagement. The problem is not only with the lack of diversity among top management positions but also with the general focus of the HR approach, which is intended to meet the strategic goals that the company has set. Because Amazon emphasizes the need for workers to show high performance to meet the strategic goals, the HR efforts rarely consider the needs of employees who work to reach the defined goals. The HRM approach at Amazon has shown to be quite harsh on the workers because they are pushed to continuously race with one another, which results in significant levels of stress rather than increased productivity. Overall, Amazon must reconsider its approach to organizational culture and human resource management practices to facilitate better levels of motivation and engagement in the workforce. Until some change is accomplished, it is unlikely that the company will witness any improvement in its workers’ performance and long-term engagement.
Recommendations to Motivate Employees
The demoralization of Amazon employees and their low levels of engagement represents a challenge to the company’s HR. The lack of motivation means that maintaining retention will be problematic on a long-term basis, which means that Amazon will have to reconsider its overall HR management approach and focus on employees’ needs first. Instead of using the ‘rank and yank’ system, it is recommended for the company to invest resources, including time and money, into performance improvement plans that will help improve the management of lower-performing workers. Thus, rather than letting go of workers who have shown decreased performance over some time, it is imperative that the organization implements a training program focused on improved collaboration and a systematic focus on overall satisfaction.
Amazon has attempted to meet this recommendation by implementing the Pivot program aimed at employees showing a long-term period of underperformance despite the support and coaching. The program was intended to provide workers with such options as improving performance, leaving the company voluntarily while receiving severance, or appealing their managers’ decisions to place them in the program (Kim, 2017). While the program was the company’s answer to rectify the brutal ‘stack ranking’ review process, the problem with it was that Amazon did not provide much reporting on the outcomes and the impact of the initiative. Therefore, the Pivot program should be seen as an attempt of the organization to manage its workers and the overall reputation. Updated reports on the company’s management suggest that it continues preserving an environment that favors only highly performing individuals.
Considering the fact that a training program has not particularly brought success to Amazon, the wisest recommendation entails implementing a balanced approach. This means that the company should avoid high-pressure situations and take more care of the well-being and career of its employees, which is expected to reduce the rate of turnover due to increased satisfaction and motivation (Pratap, 2017). Tough performance measures and rigid standards may lead to financial profitability; however, in terms of human resource management, it leads to disengagement. Therefore, a significant aspect of improving employee motivation at Amazon is to create a culture that fosters both satisfaction and performance, not just the latter. The analysis of the company’s culture has shown that it has been solely focused on showing the highest levels of performance through consistent reviews and rigid goals, which disregards the well-being of employees and the needs they may have.
Besides making some changes in the organizational culture, it is recommended for the HR managers at Amazon to emphasize internal motivation. This means that the managers should take time and effort to help their subordinates understand what motivates them; after that, it is possible to fine-tune the roles and responsibilities to align with employees’ passions and motivations (Murphy, 2022). Showing care for employees is crucial because they need to feel accepted and understood. Workers are more likely to stay motivated to show good levels of motivation when they see that their managers show care and acknowledge their efforts. In low-performing workers, showing care and attention is possible to understand the barriers to success. It is recommended to give Amazon employees more authority instead of overloading them with responsibility. This is because studies on high-potential talent revealed that workers who have the high potential do not want to get more responsibility in their developmental assignments (Intagliata, Sturman and Kincaid, 2022). What will result in greater commitment and engagement to the organization is having more decision-making authority in various assignments.
The final recommendation for Amazon to boost the motivation of employees entails creating an affirming rewards system. Such a recommendation is grounded on the assumption that extrinsic rewards have been shown to be essential for keeping workers motivated (Hashiguchi et al., 2021). Rewards that are affirming are expected to motivate workers by recognizing that they accomplish important, challenging, but attainable goals. Rewards such as promotions, increases in pay, bonuses, stock options, as well as general recognition can be affirming when they are associated with crucial goals and are not administered oppressively, as mentioned in reports on Amazon. It is crucial that the company’s HR management does not offer rewards in an oppressive matter and does not coerce workers to achieve certain outcomes because they will be rewarded (Hashiguchi et al., 2021). Thus, a system of bonuses that puts large compensation amounts at risk or encourages aggressive competition among team members must be avoided. Overall, to boost workers’ motivation, Amazon should offer benefits and perks that individuals deserve and expect. Within the approach, it is necessary to avoid oppressive leadership, fine-tune the system of rewards, and limit the adverse impact of organizational politics.
Conclusion
Amazon has remained on the list of a few top-performing companies worldwide because of its emphasis on meeting market demand and satisfying the needs and demands of its customers. Building high-tech order fulfillment and shipping facilities have allowed the company to ship orders as quickly as possible, which is something that customers expect. However, the organizational culture and HRM approaches at Amazon have not been particularly attentive to the needs of employees. The company has been scrutinized for unethical HR practices and fostering an environment that pressures employees to perform highly and having to persevere through any challenges they may endure. The HR managers are only focused on performance and do not show care for workers as people. The performance measurement structure that encourages criticism and anonymous feedback causes aggressive competition and harms collaboration, which results in decreased performance and motivation. It is recommended that Amazon implements an overhaul in its organizational culture and focuses on workers and their needs. Workers are more likely to exhibit good levels of motivation when they see that their managers and supervisors show care and acknowledge their efforts.
Reference List
Buckingham, M. and Goodall, A. (2019) ‘The feedback fallacy’, Harvard Business Review. Web.
Carmichael, S. G. (2022) ‘Amazon can’t keep thriving without fixing its culture’, The Washington Post. Web.
Hamilton, I. A. (2022) ‘Amazon drone engineer says a manager told him to nap in the evening then go back to work to ‘get more hours out of the day’’, Business Insider. Web.
Hashiguchi, N., Sengoku, S., Kubota, Y., Kitahara, S., Lim, Y. and Kodama, K. (2020) ‘Age-dependent influence of intrinsic and extrinsic motivations on construction worker performance’, International Journal of Environmental Research and Public Health, 18(1), pp. 111.
Intagliata, J., Sturman, J., and Kincaid, S. (2022) ‘How to spot — and develop — high-potential talent in your organization’, Harvard Business Review. Web.
Kantor, J. and Streitfeld, D. (2015) ‘Inside Amazon: wrestling big ideas in a bruising workplace’, The New York Times. Web.
Kantor, J., Weise, K. and Ashford, G. (2021) ‘Inside Amazon’s worst human resources problem’, The New York Times. Web.
Kim, E. (2017) ‘Amazon just launched a new training program to help employees in danger of being fired’, Business Insider. Web.
Le, T. N. (2021) Inside Amazon company culture: intense and effective. Web.
Pratap, A. (2017) HR management at Amazon: need for employee satisfaction. Web.