This case study is based on Amazon, the largest Internet-based retailer in the United States, has frequently figured among the most admired companies. However, an article published in The New York Times portrayed Amazon as a soul- crushing employer and a cruel place to work. According to the article, employees at Amazon are encouraged to be critical of each other’s ideas and performance — both openly, during meetings, and covertly, by surreptitiously sending negative feedback to each other’s bosses. As Amazon continues to be well-known for its brand and its obsession with customer service, the exposé has raised questions about Amazon’s employer brand. At the time of the article’s publication, Amazon is in the midst of implementing massive growth plans, including the construction of new office installations. Are Amazon employees thriving, or are they just barely surviving? Are such strategic human resource management (SHRM) practices sustainable?
Amazon, the largest Internet-based retailer in the United States, has frequently figured among the most admired companies.
•However, an article published in The New York Times portrayed Amazon as a soul- crushing employer and a cruel place to work.
•According to the article, employees at Amazon are encouraged to be critical of each other’s ideas and performance — both openly, during meetings, and covertly, by sending negative feedback to each other’s bosses.
•Long hours are the norm, and employees with dependent care and medical issues are viewed as liabilities.
•Employee attrition is, as a result, very high.
•Most of the ex-employees interviewed for The New York Times’ article described the culture as toxic and difficult to survive in.
•A few employees felt that Amazon was the best place to work for people who are passionate about their profession.
•Nonetheless, both Amazon and its CEO, Jeff Bezos, have experienced a decline in their public rankings since the publication of the article.
1. Does the people management strategy of care and compassion make business sense? How does the practice of keeping employees on the edge impact business in the short and long run?
2. Is Amazon’s employer brand as reported by The New York
Times sustainable? Why or why not?
3. Are employees thriving under Amazon’s
workplace policies, or are they just barely surviving?
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When it
comes to maximisation of shareholders’ wealth, making business profitable and
remain competitive, innovative, goal focused, market leader and accountable to money put into business by
investors, people management strategy of care and compassion have no sense for
a business organisation. Amazon, since its start of its operations till date,
has grown tremendously and generated great return to its investors, thus making
the company one of the best places for investors to park their money and win
heart of customers in offering unique services and experiences. Strategy of
care and compassion creates issue and become insensible for business growth.
Extra
care and compassion have negative results that hamper employees’ personal and
professional growth.1 Many times unnecessary concerns and worries
for employees distract leaders in handling the situation and decision making.
Many times, care and compassion becomes control issue for leaders.1 For
instance, managers are not able to make strong decisions because they are
concerned about employees’ reaction leading to difficulty in accomplishment of
goals of the organisation.
Care and compassion reduces abilities of employees to handle difficult task and
convert challenging jobs into opportunities of learning new skills thus
hindering employees’ growth and reduction in turnover of the company as well as
unsatisfied customers.2
To an
extent, care and compassion helps to increase the productivity of employees at
work place2 but, when it comes to make the company most innovative
in the industry and work in a dynamic environment, instead of being
compassionate; aggressiveness, assertiveness, bold attitude towards new and
challenging task, passionate to work 24/7 and capability to devise new ideas
and convert into a successful becomes more important for profitability and
survival of the business.
Constant
empathic role of leaders lead to reduction in capability of employees to face
new and unique challenges and adapt to changes required to remain market leader
in the industry and also create compassion fatigue among employees.3
It is
very important for employees of business organisation to not only work hard and
for long hours but also act smartly when it comes to fulfilment of wealth
maximisation of shareholders. Care and compassion sometimes leads to unethical
behaviour in terms of restriction of performing new and challenging tasks and
accomplishment of tasks on time leading to losses to business organisations.4
Innovation
is key driver to success for a business organisation in the industry which
demands for highly talented, workaholic, competitive and passionate workforce
rather than a work force who seeks compassion and care from team leaders. It
will hinder the process of continuous innovation and opportunity of employees’
professional growth thus leading to failure of business.5
For a
business organisation, the most crucial motivational factor that keeps them
going on and on is the profit generated out of business operations in order to
meet the expectation of shareholders and increase in valuation of company in
stock market. Care and compassion does not generate profit and satisfy goals of
shareholders. Hence it becomes sense less for a business to focus upon it.
Investors look into financial statistics of company while investing into it
rather than inculcation of care and compassion in corporate culture of an
organisation.
How does
the practice of keeping employees on the edge impact business in the short and
long run?
In short
run, practice of keeping employees on edge impact business positively in terms
of increased in productivity, effectiveness, efficiency and thus overall
profitability of the business. It will facilitate employees to take new
challenges at work place, explore new business ideas, innovate, complete task
on time and remain competitive among peers which is crucial for sustainability
and growth of a business organisation.
It will
foster employees to learn new things faster, improve morale, and a sense of
achievement while performing task at work place. It will help managers to
easily differentiate between most efficient and least efficient workforce in
the organisation6, thus enabling process of training and development
more effective and sound in the organisation.
Overall
performance of employees at work place will substantiate success of
organisation7. The organisation will be embraced with efficient pool
of talents motivated to bring the company at number one position in the
industry and increase its profitability.
It will
facilitate eagerness among employees to collaborate, learn from their teammates
and perform challenging tasks placed upon them in a fast changing global
environment to become achievers who have the capability and will power to
create history and pave the way of success for themselves and organisation as
well.8
It will increase accountability and boost
coping abilities of employees at work place to remain confident, effective and
efficient in accomplishment of tasks assigned to them8. It helps
them to focus on integration of their growth with organisational growth, work
with little or no supervision and make them proactive and street smart.
However,
in long run, practice of keeping employees at edge will impact business
organisation adversely. Employees’ fear of inability to meet
Expectations and standards set up by organisation on time will put employees at
distress in long run leading to high attrition rate, low productivity and
feeling of discontent among employees in the organisation8.
Anxiety
and fatigue pops out sometimes leading to depression and burnout due to long
working hours, meeting deadlines, and exploring new ideas for business growth
and competing with peer members for saving jobs. It reduces efficiency and
performance of employees at work place, creates job dissatisfaction and work
alienation.9
Employees
are not able to concentrate at their work, a sense of belongingness remains
missing towards organisation and employees suffer from work life balance
issues.9 Creativity is lost and employees feel demotivated and
devastated while doing something new and unique for growth of organisation thus
hampering innovation in the organisation.
Overall
efficiency and productivity of organisation is hampered dramatically if
practice of keeping employees at edge is followed in long run. It negatively impacts
innovation at work place, puts sustainability of organisation in danger and
reduces profitability of business.9
Employees
feel disengaged and find management insensitive towards their needs and
requirements leading to distortion of talent pool within the organisation.
Employees lose confidence in the company they work for and start focusing on
self fulfilment rather than organisational welfare. Employees start searching
for opportunities outside the company and quit the job due to which many times
organisations loose best talent and employees due to practice of this strategy
at work force in long run.
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2. Is Amazon’s employer brand as reported
by The New York Times sustainable? Why or why not?
Amazon has been criticised for putting employees
working for long hours, building pressure on employees through peer review
system and promoting employees to criticise each other at work place. Work
environment at Amazon is very competitive and pressure building where employees
have to compete with each other and sabotage each other to survive at Amazon.
However, Amazon as an employer brand seems to be sustainable as it has
established itself as an employer brand for those people who are willing to
work under pressure, learn and perform challenging tasks and foster constant
innovation and creativity for future.
Work philosophy at Amazon is that employees have to
work hard, smart and long and one cannot compromise on any of three10.
Employees’ motive at Amazon is to adopt challenges as an opportunity to grow,
enjoy the work and create history in the world. Customer satisfaction and value
creation for its customers through continuous innovation and customer support
is the top priority of Amazon. 11
Corporate culture of Amazon demands from employees
to use unconventional methods to generate innovative and solutions to the
problems existed at work place in order to succeed in cut throat competition
prevailing in the industry and attain market leadership. 12
Amazon as an employer suits those who are ready to take
challenges in fast changing competitive environment, become forefront for
technological innovations and are full of ambitions in terms of career growth
& development, success achievement and wealth accumulation.12
It works on the philosophy of facing extreme demands
at work place instead of running away considering it as a problem for them but
as an opportunity to career growth and technological advancement in their
skills and capability.12
It fosters an environment where people are
enthusiastic to work on cutting edge projects with innovative ideas and
solutions and ready to learn from their team members at work place who are
thriving on meeting expectations of billions of its customers and achieve
success individually as well as for the organisation. Amazon seeks for
employees who shine under pressure and are high performers and strong emotional
quotient.13
It considers its employees as a pool of talent and
facilitates training of employees to increase their capability and develop
their personality.14 Its training program enables employees to
understand what is being expected from them and get engaged with work culture
at Amazon. It will facilitate smooth
functioning of employees at work place as per the standards and norms set by
Amazon and avoid conflicts.
Human resource activities such as training and
development, performance appraisal, pay and perks are designed effectively and
systematically to achieve corporate and strategic goals of Amazon such as
continuous innovation and technological advancement to create value for its
customers and increase revenue for the company.14
Usually small teams are formed with main motive to
reduce differences, promote self management of employees and invest huge chunk
of money in training and development of its employees. Company also promotes
sharing of information inter and intra department level to promote creativity
and learn things from each other to facilitate fast resolution and decision
making.15
Amazon’s policy to hire talented people from diverse
backgrounds is the key to fulfil its objective of constant innovation and
maintain competitiveness in long run.16 It considers talented
employees as a source of competitive advantage and thus focuses to attract
people who are innovative and have firm belief in Amazon. In order to attract
and retain talent, it shares profit among its employees.
It offers more incentives to employees who serve the
company for more than two years than new employees with a motive to retain such
talents who are highly involved with organisation and reduce training cost.
Company offers best pay and perks in the industry to attract talented
personnels in the organisation. Performance based incentives and signing bonus
are integral part of packages offered to its employees17.
Performance appraisal is based on self evaluation
and peer assessment. Earlier before 2016, Performance of employees was ranked
and those who performed worst were dismissed from the company. But now, company
has changed this policy and started a retraining program called Pivot to train
its underperforming employees and offer them a chance to improve their
performance.17
Company takes regular feedback regarding working
environment from employees. It has daily question and answer feedback program
called Connections to understand its work force and problems faced by them. It
has ‘Forte’ an Employee review program in place which focuses on employees’
strength rather than their weaknesses and thus putting employees motivated
positively towards the organisation.18
Amazon plans to retrain its one lakh employees
investing $700 million.18 It has plans to expand its training
programs and adds new training programs to improve the quality of its work
force and retain talented and future ready employees at work place to foster
constant innovation, creativity and meet its commitments to become top employer
brand in the industry.
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3. Are employees thriving under Amazon’s workplace
policies, or are they just barely surviving?
Employees
are thriving as well as just barely surviving under Amazon’s workplace
policies. Amazon is a technology
driven company which is customer obsessed and innovation centric. Employees who
are passionate about what they do at Amazon in terms of innovating new products
and services to create history, earn big and become star performers of the
company are thriving under Amazon’s workplace policies.
Employees
who are ready to sacrifice their work life balance and enjoy career advancement
by fulfilling extreme demands rising at work place are thriving not surviving
in Amazon. These people are willing to work 24/7, reply mails sent to them in
the midnight, highly enthusiastic, ready to take pain on behalf of the company
to satisfy expectation of customers, meet high set standards of performance,
ready to collaborate with work force, learn and adopt new skills, give innovative
and creative insights, work on challenging and cutting edge projects, willing
to accept challenging jobs as an initiative to grow and prosper in their career
rather than problems and escape from it.19
Employees
who are deeply rooted with Amazon’s work culture and belief of work hard,
smart, long, have fun and create history are advancing in their careers and
prospering while working at Amazon. These employees enjoy working in an
unconventional, competitive and fast changing environment with a motive to do
out of box things for welfare of the company and customers and earn strong
reputation in terms of huge pay and promotion.19
Constant
criticism of ideas and opinions of peers, attending late night meetings,
sending feedback to others’ bosses anonymously to sabotage each other are some
of the features which otherwise employees thriving at Amazon do not like but
for the sake of success in their career and organisational growth, they feel
correct to do so.19
Effective training programs offered by Amazon to its employees on regular basis help in
career growth and personality development of employees to accept new challenges
and get adept to it.20
There are various reasons due to which
employees find that they are merely surviving under Amazon’s policies:
Employees
at Amazon find they are surrounded with highly skilled and talented people who
are extremely boosted to think creatively to overcome new operational
challenges, devise innovative ideas to pave the path of success and meet the
expectation of company and customers.20
Cut
throat competitive working environment creates huge pressure to perform and
surpass their team mates to survive in the job. Long hours of operation create
mental stress and anxiety sometimes leading to frustration and depression.
Working even at vacation and constant overtime completely destroys work life
balance and thus hampers personal well being of employees. Surviving Employees
find no support from management with regard to work life balance.20
Standards
of performance set at Amazon are unexpectedly too high and unavoidable which
creates pressure and distress among employees leading to job dissatisfaction
and fear of job loss.
Culture
of promoting unnecessary competition among co-workers and criticising ideas of
peers in meetings prompts star performers to succeed in career and low
performers to quit from the job. Company’s culture to not to include women in
top management hinders female employees’ career growth and advancement which is
against women empowerment guideline.
Yearly
performance review process is based on rankings where managers discuss
subordinates’ rankings. Employees are encouraged to criticise their peers by
sending feedback to top management and low performers are thrown out of the
company. However, Amazon has currently changed this policy and launched
retraining program to give a chance to low performers to improve their
performance and meet the expected standard.21
There is a fear in the mind of old employees
that they will be replaced by new and young employees as Amazon encourages to
promote dismissal of old employees with more commitments in terms of
responsibility towards family, parents due to which they will not be able to
focus on work and contribute extra time to company as compared to young
employees who have less commitments and more time to focus on work.
Management
of Amazon is not sensitive towards employees who suffered from severe diseases
such as cancer, miscarriages or some personal crisis and such employees are not
given adequate time to recover and perform with their highest ability and are
evaluated unreasonably on performance scale and are dismissed. This inhuman behaviour
and work place policies hinder employees’ survival at Amazon and exhibit
cruelty on the part of management’s responsibilities towards its employees.
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