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Introduction Artificial Intelligence, Strategy and Human Capital Case Study at Amazon
This assignment is mainly based on Artificial Intelligence (AI), strategy, as well as human capital. A case study about the company Amazon and its uses of AI has been chosen for the present assignment. The strategy of AI is important because it focuses on the core business objectives and helps to achieve goals. It can help to improve the HR operations of the present company. In this assignment the analysis will be made on the case study, AI and human capital concept, four building blocks strategy, theory of HR as well as workforce management and a conclusion will be made based on it.
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About case study
It is a case study of Amazon Company and its AI application and this is one of the first companies that “foray into ML with the AI bot Alexa”. It is considered a virtual assistant powered by voice (zentail.com, 2022). It helps the customers in finding as well as purchasing products on mobile. It is also available for checkout by voice prompts in place of tapping or clicking on the screen. Amazon uses AI continuously for understanding the intent as well as the context behind the search queries of customers. It helps the company to understand the matter of why people are choosing specific products (bernardmarr.com, 2022). The foundational smart speaker product of Amazon, Alexa mainly runs on a conversational AI platform.
Concept of Artificial intelligence, Strategy and human capital
AI is referred to as the human intelligence process’s simulation with the assistance of machines and there is the specification of computer systems. The growth of the organisations mainly shows the production of more data (Akerkar, 2019). Here, an effective data strategy is important for making sure the growth of information is properly managed.
![Artificial intelligence]()
Figure 1: Artificial intelligence
(Source: Simaet al. 2020)
Here an AI or artificial intelligence strategy can help with information growth as well as protection. Therefore, it can be said that the present company Amazon can effectively use this strategy for the security of information as well as in increasing business value (Simaet al. 2020). There are various applications of this process and they are in expert systems, recognising speech, processing natural language, as well as machine vision.
Business strategy is the most important that can help an organisation in its growth. This is considered an action plan that is designed for achieving an overall or long-term goal. It includes four basic options and they are called the four building blocks of strategy (Hafeez et al. 2019). The options include “conceding, confronting, competing, and cooperating”. The strategy of work has different aspects and it speaks about a good communication system as well as coordination within the team for better performance within the organisation. The present company Amazon has specific strategies for their business success and they mainly focus on the AI process for the improvement of HR practices.
Human capital (HC) is another important aspect related to business organisations. This term refers to the concept of the economic value of the skill as well as the experience of a worker. This concept mainly refers to the assets such as training, education, intelligence, health, skills, and different things that relate to the employee value like punctuality as well as loyalty (Coe and Yeung, 2019). It is referred to as an intangible quality or asset that has not been included in the balance sheet of a company. HC helps to develop the profitability as well as productivity of a company. Therefore, it can be said that it is an important aspect related to HR as well as AI practices. Company of Amazon also has applied this qualified aspect for the development of their organisation.
Four building blocks of strategy to assess the role and impact of AI in business strategy
In today’s time, it is highly important that an organisation implement new technological processes that can be helpful for the organization to attain a significant rate of progress. This situation can be highly helpful. The importance of AI in today’s time is inevitable and that cannot be neglected if a company is wishing to make progress at par with global standards. Artificial intelligence is one such technology that is necessary to be utilized to effectively utilize the available resources and the people involved within an organisation.
There are four building blocks of strategy that are necessary to be taken into consideration when it comes to formulation of strategy necessary for the progress of the organisation on a global stage. The first would be to concede it is the primary step involved when it comes to utilization of a comparatively new technology. The utilization of AI in the initial stages and through an understanding of the technology in the global market requires a defensive stance to integrate the technology into the business model.
After a thorough analysis of the subjects and the aspects that can be utilized by technology like AI, a confronting stance can be taken forth. This situation has been utilized by Amazon efficiently through the utilization of AI and the use of various features as well (Maedcheet al. 2019). Furthermore, Amazon has raked a competitive stance in the utilization of features like chatbots and voice-assisted shopping processes that have been highly helpful in emboldening the customer base of the organisation. The inclusion of such features that has to provide ease and comfort to the4 customers has proven to be highly effective for this B2C Company to attain new heights of success in a brief period of time. Even in the times of the pandemic when the global market was struggling to hold on to stability this company utilized the technologies like AI and catered to the basic needs of people. The overall sales of this company reached a 45.4% growth in 2020 (statistia.com,2022). Amazon has utilized the strategies of new technologies and utilized them efficiently in terms of progress and growth for the organisation.
![Annual net sales of Amazon 2004-2021]()
Figure 2: Annual net sales of Amazon 2004-2021
(Source: statista.com, 2022)
The inclusion of new technologies has been highly helpful for the organisation over the stretch of time since 2004. The usage of AI and the customer service being provided by the company that catered to the basic needs like product suggestion and forecasting and associated marketing strategies combined has helped Amazon grows by leaps and bounds since 2017. The new revenue for the company was around 470 billion US dollars in 2020 (statista.com, 2022). Lastly, the aspect of cooperation with other people and facilitating a stage of business for small businesses and other global giants have been and continue to be highly successful for the growth of Amazon.
HR theory on overall business strategy and management of Workforce
There are multiple business strategies that can be followed by the HR of a particular organisation that will help the organisation to chart new heights of success. An organization’s HR is responsible for maintaining an effective and healthy communicative bridge between the management body and the workforce working within the organization. This aspect is beneficial for the organisation to attain a cordial and coordinating approach and thereby formulate effective business strategies that would be helpful for the organisation.
Certain business models are attained by the human resource department that professes effective progress for an organisation. A 5ps model of strategic HRM is a crucial model of the work process. This aspect is most prominent practiced in the HR department of Amazon to draw the sot out of the productive performance of the organisation and be global a business giant. The basic constitutional aspect of this model includes the purposeof the particular course of work. This is important to be considered the foremost stage to formulate the rest of the process (Shahi and Neloy, 2020). Secondly, the principles are structures that would give out proper guidelines regarding a particular course of work that is to be followed while attaining the necessary strategies required to be followed by the organisation. After the purpose and principles are formulated. The process is structured against eh overall organizational structure that prevails in the particular work process these processes are formatted and aligned with the leadership style that prevails in the organisation. Lastly, people and the performance. The workforce involved in a particular organisation plays a pivotal role when it comes to driving a particular organisation to new business heights (Manahanet al. 2022). The workforce involved in the new organisation is the pillar of the productive unit. It is the responsibility of the HR department to utilize the available resources of the people in the workplace and formulate strategies to implement new measures for enhancement in productivity. They also utilise their potential and make strategies to keep people engaged with the workplace and dedicated to the vision and goals of the organisation. All these aspects cumulatively help in enhancing the performance of the organisation and the people involved within.
Amazon as an organisation and the human resource department is involved in utilizing the aforementioned model of the work process to enhance the potential outcome in terms of quality and quantity for the organisation. This aspect of progress is further enhanced by the HR department of Amazon by utilization of new technologies. The HRM of this organisation utilizes a flywheel approach in association with the usage of artificial intelligence (Huang et al. 2022). The "flywheel" is a term associated with engineering that is oriented to the ways companies utilize the conservation of energy all the while maintaining a significant momentum of the work process. This aspect is utilized by amazon in terms of the usage of AI to properly utilize the resource and potential available in the workplace. This helps enhance productivity and identify significant sections for improvement and keeping a stable space of progress and attaining a pinnacle of success.
Workforce management in organisations in a global environment
Management is an important part of an organisation and nowadays various organisations face management issues in their companies. Every organisation needed to have significant as well as contemporary changes for organisational development (Anwar et al. 2020). It has impacts on the organisations related to the behaviours, decisions, organisational configurations, as well as human capital.
The situation of an organisation influences the products of it and change in the environment within the organisation is sometimes needed. It can help to improve performance as well as enhance the value of the organisation (Akerkar, 2019). Amazon is a multination company that has various branches in their sector and has applied a workforce management strategy for managing the global environment.
Many organisation has the goal of global expansion and for this they have to overcome hurdles. A company can achieve this position by having a strong HR strategy as well as an employee management plan. The global workforce can be managed with the adaptation of some strategies:
Innovative approach: An organisation can manage their workforce by applying innovative approaches within the organisation such as flexible changes.
Open communication style: It is an effective strategy, it is very helpful for the organisation to manage the workforce, and it can help to build strong relationships.
Cultural awareness: Cultural sensitivity, as well as awareness, is considered the most effective approach for bridging the gaps and employee engagement (Coe and Yeung, 2019). This awareness can also help in making a healthy bond among the employees and provide a good environment to work.
Application of HR analytics: The analytics of HR applies sophisticated data models and it helps in innovative collaboration within the organisation. This effective strategy can help the organisation in developing its technologies for product management.
Conclusion
The present assignment mainly focuses on the idea of artificial intelligence which is considered the most important aspect of a business or company. A case study of Amazon has been chosen for the assignment that speaks about the importance of AI within the present company. The AI system helps in the improvement of a “voice-powered virtual assistant” namely Alexa. It is considered the effective aspect of this study and it relates to the development of the organisation. This factor is very essential and it has given importance to the product recommendation system. Alexa helps to make shopping with the recognition of voice and gives the customers a hand-free user experience.
References
Book
Akerkar, R., 2019. Artificial intelligence for business. Springer.
Journals
Anwar, N., Mahmood, N.H.N., Yusliza, M.Y., Ramayah, T., Faezah, J.N. and Khalid, W., 2020. Green Human Resource Management for organisational citizenship behaviour towards the environment and environmental performance on a university campus. Journal of Cleaner Production, 256, p.120401.
Coe, N.M. and Yeung, H.W.C., 2019. Global production networks: mapping recent conceptual developments. Journal of economic geography, 19(4), pp.775-801.
Hafeez, I., Yingjun, Z., Hafeez, S., Mansoor, R. and Rehman, K.U., 2019. Impact of workplace environment on employee performance: mediating role of employee health. Business, Management and Economics Engineering, 17(2), pp.173-193.
Huang, W., Shi, X., Wang, Y. and Zhu, Z., 2022, March. Standard Option and Power Option of Amazon. Inc and Aensitivity Analysis. In 2022 7th International Conference on Financial Innovation and Economic Development (ICFIED 2022) (pp. 316-323). Atlantis Press.
Maedche, A., Legner, C., Benlian, A., Berger, B., Gimpel, H., Hess, T., Hinz, O., Morana, S. and Söllner, M., 2019. AI-based digital assistants. Business & Information Systems Engineering, 61(4), pp.535-544.
Manahan, J., Lacatan, L.L. and Miguel, A.R., 2022. Implementation of PRIME-HRM Program Using Cloud-Based Technology.
Shahi, K. and Neloy, H., 2020. Global transition of HR practices in covid-19 pandemic situation: a systematic review through 5P's model of HRM. Management and Human Resource Research Journal, 9(6), pp.50-57.
Sima, V., Gheorghe, I.G., Subi?, J. and Nancu, D., 2020. Influences of the industry 4.0 revolution on the human capital development and consumer behavior: A systematic review. Sustainability, 12(10), p.4035.
Websites
bernardmarr.com, (2022), How Amazon Uses Artificial Intelligence: The Flywheel Approach, Available at: https://bernardmarr.com/how-amazon-uses-artificial-intelligence-the-flywheel-approach/ [Accessed on: 11th November, 2022]
statista.com, 2022, amazon sales growth, Available at: https://www.statista.com/statistics/1309659/amazon-sales-growth-channel/ [Accessed on: 11th Novermber, 2022]
statista.com, 2022, annual net revenue of amazon 2021, Available at: https://www.statista.com/statistics/266282/annual-net-revenue-of-amazoncom/ [Accessed on: 11th Novermber, 2022]
zentail.com, (2022), Amazon's Flywheel Approach: How The Tech Giant Uses AI, Available at: https://www.zentail.com/blog/amazons-flywheel-approach-how-amazon-uses-ai#:~:text=Amazon%20is%20one%20of%20the,or%20tapping%20on%20the%20screen. [Accessed on: 11th November, 2022]
