Firms that apply e-commerce purpose to achieve their goals and performance targets by collecting information about their customers and keeping track of the customers’ trends. Amazon is one of the largest e-commerce companies that was established in the year 1995 by Jeff Bezos. The developers had an ambition to create a virtual shopping avenue for book lovers. However, over time they have expanded their products to include all consumer products that are usually available on physical shopping outlets. Amazon experienced great success in the nineties by being a point of interaction for its four kinds of customers; content creators, sellers, enterprises, and consumers. Amazon has effectively implemented an integrated system by utilizing internet to manage their information systems along their application and technical structures.
Management Information Systems (MIS) enhances the ability of a company and its structures to function in such a manner that provides synergy between the exchanges of information systems and people. MIS promotes various function of the management and in a large way contributes to the decisions made at both the operational level and the management level. Amazon has several Information Systems for activity on the internet ( Ravindran & Warsing, 2016 ). They have separated their website services from the ordering system in order to enhance security. Maintaining a fast, reliable, robust and easily accessible web service is important for amazon to manage the thousands of customers who are always searching for varied products. Amazon uses Smart Analysis Search to detect and track fraudsters and also identify the needs of a customer and personalize the help given. Also, there is Transaction Processing System which personalizes customers’ profiles through features such as click purchases and payment method.
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Amazon has a sustainable competitive advantage over other companies in that they have maintained market leadership over the years whereas most other firms rise and fall seasonally. The major source of their advantage is providing quality products at lower prices which is the preferred Customer Purchase Criteria (CPC) for its customers who would like to purchase products based on their prices, reliable services and fast delivery. Besides, it was part of the founder’s initial vision to give customers the lowest prices. Amazon’s customer service is unmatched to similar businesses such as e-bay giving the company a step ahead in the industry ( Kim, 2016 ). However, there are still some considerations that they can make to further deal with competition that is growing every other day. First, Amazon can introduce a new product such as smartphones that would attract more customers, satisfy the present ones and also maintain their loyalty. Also, they should improve on the adaptation to technology and even employ advanced models like artificial intelligence.
The Supply Chain System of Amazon plays a major role in the success of the company which gives the company an advantage over others in the same industry. Since the automation of the warehouse and the Supply Chain Management in 2000, their success was outright by 2004. All activities within the supply chain are managed using the Customer Relation Management (CRM). The basis of using CRM is collecting information about the customers such as order records, past purchases, profiles and credit card details. Automated communication is maintained with customers by use of messages and emails ( Greeff & Ghoshal, 2004 ). The CRM system enhances effective integration of customer services, sales and communication.
Amazon has an established design of dealing with customers. To begin with, their website promotes selection of customers based on their behavior and search products. On acquiring customers, there is a method of storing all their details about their personality and list of products that would fulfill their needs ( Farooqui, 2010 ). They also have a review system which is a way of understanding the needs of the customer and it also serves as a way of marketing.
Supply Chain is much more than just moving products across the actors of the chain. Rather, products are only part of the reason why a chain is formed. Information is the major reason for maintaining supply chains and striving to maintain them at the most effective levels. This is because several components comprise the flow of information such as general terms of trade, forecasting and inventory levels. The condition of trade are the rules set by retailers or suppliers to inform the mode of business with the partners. If the terms communicated are incorrect or late, even products cannot move within the supply chain. The terms include return policies, credit terms, discounts and delivery methods ( Christopher, 2016 ). Accurate forecasting of the expected sales or supply also informs the appropriate amount of products to order or keep in the warehouse. Lastly, managing inventory levels is necessary for the suppliers and retailers to balance their cash-flows. All these components of information make it valuable to a company than moving products because they must be considered before products are supplied or accepted by the retailer.
In conclusion, coordinating activities of a Supply Chain Management requires a robust Information Management System between all the customers. Amazon is one of the firms which has demonstrated the results of such an MIS causing it to be a leader in the online retail industry. Their automated warehouse as well as communication with customer reduces lead times and increases the speed of offering feedback and delivering products. Notable also is the role that information plays in a supply chain. The success of a supply greatly relies on how efficiently information is passed from one party to another.
References
Christopher, M. (2016). Logistics & supply chain management . Pearson UK.
Farooqui, S. U. (Ed.). (2010). Encyclopaedia of Supply Chain Management . Himalaya Publishing House.
Greeff, G., & Ghoshal, R. (2004). Practical E-manufacturing and supply chain management . Elsevier.
Kim, D. (2006). Process chain: A new paradigm of collaborative commerce and synchronized supply chain. Business Horizons , 49 (5), 359-367.
Ravindran, A. R., & Warsing Jr, D. P. (2016). Supply chain engineering: Models and applications . CRC Press.
