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RSM100 Final
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Exam of 14 pages for the course Chem 1020. at Chem 1020. (RSM100 Final)
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RSM100 FinalWhat are the key success factors at Amazon related to operations management? -
ANS--Values their customers (customer service)
-They want to be the most customer centric company in the world
-Efficiency (2 day prime shipping, employees help robots, etc.)
-Instead of having robots help employees, employees help robots
What is the Cheetah and Gazelle concept and how does it apply to Amazon? -
ANS--Amazon (the cheetah) tries to go after all the small businesses first (gazelles)
-Once small business is dependent on Amazon, they change terms
-Once they create a dependency on Amazon, the smaller businesses now have to abide
by Amazon's rules
What strategic decisions did Amazon make that have made them successful? -
ANS--Putting smaller companies out of business, they start selling on amazon giving
Amazon more market share
-Forgo profits in the short term to gain profits in the long term
-Take an initial loss to build their market share (over 20 years without any profits)
-Ability to gather and process data to determine demand
-Diversifying portfolio: bought whole foods, prime, space industry etc
-Heavy r&d? Investing into other services such as streaming
-Partnerships (also helped keep their costs down):
-Got law enforcement involved (promoting ring software)
-Headquarters in different cities around world
Amazon can continue to sustain this loss due to: - ANS-Equity financing (Jeff is a
businessman who convinced others to invest)
Convinced investors that amazon was the future infrastructure
AWS (amazon web services) - cross subsidizing their growth in other businesses
Discuss the use of big data and data analytics at Amazon - ANS--Dynamic pricing -
determining the WTP of different consumers, current demands
-Encourages consumers to buy more with each order (e.g., people who bought this also
bought this)
-Tracking employees and customer movement in stores
Explain the concept of "Antitrust" and explain how it applies to Amazon - ANS--The idea
of promoting competition for the benefit of consumers
, -Governments are afraid there will be no competition in the market and doesn't want
Amazon to be able to influence the market prices & quantity (operate as a monopoly)
with no close substitutes
-Ensuring the consumers gets the lowest price possible made it difficult for the antitrust
policies to go after them (they have so much market power)
-Antitrust policy/act is there to keep competition active
Is Amazon using predatory pricing practices which do not comply with Antitrust
regulation? - ANS--Yes, it was predatory
-demonstrated by the fact that they were cross subsidizing their e commerce business
with AWS as well (something other companies don't have the luxury of doing)
-Put competitors out of business
-Amazon changes their prices 2.5 million times a day
-Amazon's algorithm would look at diff prices on diff websites, and then amazon would
price matches to a lower price to gain all the consumers
Amazon was recently charged by the European Union in an Antitrust lawsuit. Should
Canada do the same? YES - ANS--We should treat all of these big corporations equally
-Amazon looks at products and makes their own version with Amazon Basics which will
then take away your business
-If Amazon does not like you for whatever reason, they can change the order in which
your products show up on search
-Amazon can change your prices (ie. Black Friday Amazon posted prices above the
regular prices and played it off as a discount)
Is Amazon good or bad for contemporary innovation/startups? GOOD - ANS--Allows
new businesses to have access to huge customer base
-Amazon inspires these small start ups as Bezos built his empire from practically
nothing thus inspiring other businesses to grow
Is Amazon good or bad for contemporary innovation/startups? BAD - ANS--Amazon
Basics sometimes copies products and gains all the revenue from selling their own
version
-They're going to drive out competition and try and steal the competition for themselves
-Other firms did not capture the same opportunities Bezos did when the market potential
was newfound thus had to rack up market share/capital to expands and dominate like
Amazon did
-Since they change prices 2.5 mil times a day,
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