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Cultural Management in Amazon – The Management of Cultural Diversity

Introduction

In every organisation, culture defines certain standards and values; quality measures; the degree of openness, flexibility and concentration of power; temporal effects and ways of work for the employees. It unexceptionally plays a critical role in influencing the operations and strategy of an organisation in all the given hierarchies that exist in the firm.

An organisation’s culture evolves with its key personnel belonging to varied backgrounds. Typically, when different cultures interact, there exists heterogeneity initially with the desired endpoint to have a homogenising effect (McFarlin & Sweeney, 2014). As culture impacts the organisation positively and negatively, it is pertinent to manage the impact caused due to cultural changes and cultural interactions. This will ensure smooth functioning within a multicultural environment.

Therefore, the emerging organisational culture depends on how varied the interacting cultures in the organisation are, the way they interact, and the way the interaction is managed. This is discussed with reference to cultural management theories proposed by Berry, Simons and the adapted Hofstede Model.

Reference is also made to other supplementing theories that help in further evaluating the relevance of the proposed theories. With this backdrop, the cultural management of Amazon, an international retailer, is discussed and analysed.

Amazon has been in the news for being referred to as ‘Marvel and Monster’ for its distinct work culture (Kantor & Streitfeld, 2015). Heterogeneous cultures characterise the organisational culture at Amazon as it has a global employee as well as customer base, which is, however, outperformed by a well-defined corporate culture. But the retailer has issues in managing the same which is reflected in the high turnover rate of the employees.

cultural management in amazon

Theoretical Concepts and application to Amazon

Acculturation Theory

Berry (1980; 1997) defines acculturation as the interaction between groups and individuals of dissimilar cultural backgrounds within a given setting and the subsequent adaptation from such interaction. Such diversity incorporates similarities and differences with regard to procedures and behaviour at work in the context of multicultural and cross-cultural dynamics (Gelfand, Erez, & Aycan, 2007). Cross-cultural behaviour in an organisational context is an important facet in determining work motivation and the relationship between individuals and the organisation at large.

It has been reported in recent times that Amazon, Inc. employs a blend of inventive but somewhat punitive measures for employees working at the company(Ryssdal, 2015). As individuals, employees have a work culture that has been developed over a period of time through the education system and experience in the field. They employ certain unique values and techniques in their individual exertions, which are expected to integrate with values already established in their organisation.

The company has built a reputation for having a hardworking employee base over the years. This has partly been instigated by strict incorporation and adherence to strict company culture. These high standards and expectation have been embraced by a number of people whilst others deem them too high-handed. One of the main reasons behind the latter stance is the belief that it strangles personal values and work ethics in favour of those set forth by the company.

According to an investigation by Kantor (2015), fresh Amazon recruits are introduced to strict measures at orientation, measures that are used to integrate them into a singular way of working in the company. New recruits are encouraged to overlook “poor habits” cultured into them in their previous work. They are further warned that they will hit a snag due to the unrelenting speed at the workplace, a wall that they are expected to “climb over” rather than stall.

To be proper ‘Amazonians’, employees are provided with 14 rules (leadership principles) inscribed in laminated cards that they are expected to abide by  (Amazon, 2016). Individuals who acclimatise to ideal proportions are given virtual awards decreeing that they are ‘peculiar’, which is a phrase used by Amazon to represent a turnover of workplace conventions.

This harsh working environment and culture are not meant to demoralise new employees in the company. Rather, it acts as a filter mechanism for the management to discern between the ideal and non-ideal employees in accordance with the organisation’s culture. Employees are expected to be innovative, hardworking, responsible, and ready to meet company goals irrespective of how tough they are.

This culture has enabled the company to grow on a massive scale, increase turnover, and attract a large customer base in the market, to the disadvantage of its competitors. Additionally, it has enabled Amazon to build a reputation that attracts only the best in the job market, a feat that few companies can match. Despite these facts, a considerable number of problems have arisen, chief among which is the high pressure on employees to perform and adjust to strict guidelines. This has caused many employees to leave the company, searching for better working conditions.

The theory of acculturation majors in adapting diverse cultures into a singular one. In this instance, acculturation encompasses incorporating employees (with their respective cultures) into the organisational culture. The major problem at Amazon is that employees are expected to completely shift their cultural backgrounds in favour of those established in the company. This can be a daunting task, particularly for individuals who have been nurtured in a totally different environment. They require time to adjust their respective stance by company culture. Using preset principles to judge them can prove to be demoralising and, in turn, render them non-ideal for the company.

Acculturation theory can mitigate this problem by using procedures to integrate individual beliefs and ethics with company culture. This will not only encourage diversity in the company but also enable them to conquer new frontiers that could not be reached through a singular approach.

Schein’s Model of Organizational Culture (Onion Model) 

Schein (1984; 2010) developed a three-level model (onion model), which provides that organisations adopt a culture over time based on 3 major elements: symbols and artifacts; adopted values; and underlying assumptions. Artifacts encompass the visible elements in an organisation (processes, logos, architecture, mission and vision, and corporate clothing, among others); adopted values are the rules of conduct or values explicitly expressed by the company; whilst assumptions are the underlying beliefs or unconscious behaviours that are embedded in an organisation’s culture. Such values and elements are cultivated into new employees for them to assimilate into a given organisation.

There are many visible elements that can be used to discern Amazon’s culture. The main symbol, which is synonymous with the company, is its logo (“Amazon Mark”).

The Amazon Mark, as seen above, encompasses a tagline with the company’s name (Amazon) with a smile/ arrow transcending from A to Z. This visualisation of a smile depicts the customer experience when engaging with the company whilst the arrow denotes that the company sells everything a consumer wants. Still, the colours used depict certain organisational values. Black represents the company’s elegance, supremacy, and dominance in the market, whereas orange signifies happiness and pride.

Amazon’s vision is to become a global consumer-centric company where consumers can get any product they would want to purchase online. Its mission, on the other hand, is to provide consumers with a variety of products at their convenience and at the lowest prices possible. Amazon employees are not restricted to specific dressing codes but are instead identifiable by identification tags that are compulsory while at the workplace.

The second level of the onion model is the individual values and conducts of employees, which in turn represents the intricate values of the company as a whole. Amazon employs a rigorous policy with regard to employee selection and code of conduct. A singular approach enables the company to maintain a certain calibre of employees who are expected to satisfy significantly high expectations. This provision thus requires employees to put in long working hours, at times extending to their time at home, as well as meeting tight deadlines. Still, it is not uncommon to find junior employees being offered a greater responsibility compared to most organisations.

Amazon also creates a competitive environment where employees are ranked against each other, which can be quite uncomfortable and demoralising for most individuals. However, the management sees this as a means through which employees can put in more effort and come up with innovative ideas that will propel their stance. Additionally, the company employs a strict evaluation system that has a pile of a lot of pressure on employees, some of whom have been affected psychologically or health-wise(Ryssdal, 2015). These harsh measures have nevertheless played a crucial role in creating a perception that Amazon employees are hardworking and innovative, which has been central to the organisation’s immense success.

The third and final phase of the onion model is the assumption level. This level encompasses facets of human nature that have an intricate, albeit hidden, influence on an organisation’s culture. Amazon has been accused a considerable number of times over the past few years for been quite stringent on its employees, which has led to a significant number of them having health complications or quitting their work. The major exposé in this regard was done by Kantor and Streitfield (2015), which triggered a huge public debate on how Amazon treats its employees, which has been tagged as abusive.

The company (courtesy of founder and CEO Jeff Bezos) defended itself by claiming that its culture is merely designed to get the best out of all its employees(Ryssdal, 2015). It is undoubted that this has been a major attribute of the success witnessed in recent years. However, critiques have rebutted this stance claiming that it drains employees of their freedom and ability to engage in other activities aside from work.

The first level (artifacts) of the model is well developed and less problematic in comparison to the other two (adopted values and assumptions). The main problem arising in the latter is the strain placed on employees to perform and meet set goals. This is mainly instigated by the singular approach used by the company where employees must align with organisation values rather than integrating their individual values. Learning from this model, the company can look to ensure that individual employee needs to align with company needs in order for them to work optimally whilst being comfortable at the workplace.

Hofstede’s Cultural Dimension Theory’s Application to Amazon

Organisational culture has been defined by Hofstede (2011) as how different individuals of an organisation relate to each other and the external environment in contrast to other organisations. This is with regard to their respective beliefs, ideologies, and procedures. The Hofstede model comprises five major elements- power distance, masculinity/ feminity, uncertainty avoidance index, individualism, and long-term orientation- that influence organisational culture and employee behaviour.

Power distance deals primarily with the level of power delegated to individual employees with regard to their job description. Amazon employees are divided into teams, which are tasked with specified roles such as sales, procurement, finance, shipping and so forth. These are further divided into individual roles and roles, with each team having a manager to oversee operations. Team members are answerable to their respective managers, whilst managers at different levels are accountable to the CEO. Nevertheless, individual employees are delegated considerable freedom in the administration of their work and responsibilities of a higher magnitude in comparison to most organisations.

Masculinity/ feminity encompasses the disparity between male and female tenets concerning the organisation’s culture. A 2014 report by Amazon showed that its global employee base of approximately 88,400 employees comprises 61% Male and 39% female. Yet, managerial positions had 76% (male) and 24% (female) gap.

This disparity shows that the company better suits men to steer it towards its preset goals. This is particularly true, especially when considering the stringent measures for employees to achieve. Women are considered more vulnerable to the stresses of work in comparison to men, especially those with families. Considering Amazon requires its employees to go an extra mile in achieving set targets, it doesn’t come as a surprise that the proportion of women is lower than that of men.

The uncertainty avoidance index incorporates a culture where employees are able to tolerate unforeseen circumstances or unintended outcomes in their line of work. Amazon has established a culture that is pegged on innovation and hard work. With this come huge risks and uncertainties that employees are required to tackle appropriately. Amazon employees are thus required to tolerate both comfortable and uncomfortable situations, even when facing strict circumstances and meet all set goals. This is a culture that is embedded in them from the moment they begin working at the company.

Individualism encompasses the state where employees work as a single unit or in teams in tackling particular tasks. Employees at Amazon are divided into teams, where they are given both team and individual goals. Each team member is expected to satisfy their individual goals within the stipulated time whist also meeting team targets. Still, employees are required to challenge each other and compete whilst incorporating long and late working hours to beat predisposed objectives. All this is supposed to align with set guidelines and leadership principles within the overall organisation. Still, evaluation is done on an individual basis, where employees are either rewarded or refuted based on their singular performance.

Finally, long-term orientation encompasses the duration of the relationship between employees and the organisation. This could be short term or long term. Amazon strives to maintain a long-term relationship with employees it deems ideal. Ideal employees in this instance comprised hardworking, innovative, smart, and dedicated individuals who can operate comfortably in stressful and strenuous circumstances. This harsh environment is nevertheless a primary reason for employees to leave in search of better opportunities, whilst others who fail to meet set criteria are fired at some point in time. Duties are offered regarding short-term targets that aim at much larger objectives in the long run.

This model has revealed a very stringent culture at Amazon that only favours a certain calibre of employees. This is pegged on meeting ideals set by the management that may seem high-handed to many people. Nevertheless, individuals who are able to meet them are rewarded by the company and maintain a long-term relationship that seeks to get the best out of them. This can, however, be improved if the company considers establishing gender balance in the managerial posts. This will prove helpful in establishing policies that would create a proper working environment for individuals of both genders whilst establishing a culture of success, hard work, and innovation.

Conclusion and Recommendations

This paper has looked into the organisational culture of Amazon.com, Inc. concerning three theories: Acculturation Theory, Schein’s Model of Organizational Culture (Onion Model), and Hofstede’s Cultural Dimension Theory. One of the significant findings has been that Amazon has created a unique and much more stringent culture compared to other organisations. This stance is based on the company’s belief that it can achieve its goals and ambitions only if it gets the best out of its employees. Still, it believes that having employees who are hardworking, smart and innovative is vital to establishing a culture that is geared towards success.

Employees are nurtured into this culture from the moment they are oriented into the organisation, where they are encouraged to do away with their past experiences in other organisations. Despondently, not everyone is able to withstand the pressures of working at Amazon and is either fired or quit. Nevertheless, debates have arisen in recent years criticising the organisation’s culture, with some accusing it of being abusive and high-handed.

Former employees have complained of strict work ethics imposed on individuals to meet goals, some of which limit their life outside work. This has led many individuals to ailments such as depression, whilst others have been forced to leave for failing to meet the demands of their job description.

            In this regard, Amazon should attempt to reconsider its approach toward its relationship with employees. The majority of new recruits are required to do away with values and ethics that have been nurtured in them over the years once they join Amazon. This can be a daunting task considering people have diverse backgrounds in their personal and professional lives.

The company should instead consider a system that integrates individual employee and organisation values towards set goals. This will not only allow employees to function comfortably and have achieved goals but also maintain a long-term healthy relationship with the company. Nevertheless, it should be appreciated that the current system has propelled the company to the heights it has achieved to this day. The recommendation provided above is simply geared towards improving the system rather than doing away with it.

References

Amazon. (2016 b). “Available at Amazon” Logo Usage Guidelines. Retrieved from Amazon.com: https://www.amazon.com/gp/help/customer/display.html?ie=UTF8&nodeId=201713630

Amazon. (2016). Leadership Principles. Retrieved from Amazon.jobs: https://www.amazon.jobs/principles

Berry, J. (1980). Acculturation as varieties of adaptation. In A. Padilla, Acculturation: Theory, models, and some new findings (pp. 9-25). Boulder, CO: Westview.

Berry, J. (1997). Immigration, acculturation, and adaptation. Applied Psychology: An International Review, 5–34.

Gelfand, M., Erez, M., & Aycan, Z. (2007). Cross-Cultural Organizational Behavior. Annu. Rev. Psychology, 479-514.

Kantor, J., & Streitfeld, D. (2015, August 15). Inside Amazon: Wrestling Big Ideas in a Bruising Workplace. Retrieved March 8, 2016, from The New York Times: https://www.nytimes.com/2015/08/16/technology/inside-amazon-wrestling-big-ideas-in-a-bruising-workplace.html?_r=1

Kantor, J., & Streitfield, D. (2015, August 15). Inside Amazon: Wrestling Big Ideas in a Bruising Workplace. Retrieved from The New York Times: https://www.nytimes.com/2015/08/16/technology/inside-amazon-wrestling-big-ideas-in-a-bruising-workplace.html?_r=1

McFarlin, D., & Sweeney, P. (2014). International Management: Strategic Opportunities & Cultural Challenges. Routledge.

Ryssdal, K. (2015). Amazon’s company culture: innovative or punishing? Marketplace.

Schein, E. (1984). Coming to a New Awareness of Organizational Culture. Sloan Management Review, 3.

Schein, E. (2010). Organisational Culture and Leadership. Jossey-Bass.

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