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The advancement in information technology has contributed to the widespread emergence of electronic commerce and the purchase of online goods, rendering it a traditional mode of transaction. Many businesses have been engaged in this form of market, including Amazon.com, which is the largest internet marketplace and international e-commerce organization. Amazon.com has discount outlets in countries such as Canada, Germany, India, Brazil, the United Kingdom, the Netherlands, Jordan, Ireland and Mexico, and also exports some of its merchandise to a few countries around the world (Amazon.com, 2016). In order for companies such as Amazon.com to have a competitive advantage and increase their efficiency the application of management of global information system is very crucial. The management of global information system helps in the collection of personal information of customers in a manner that is convenient and also facilitates the control of the logistics systems. This work will examine the challenges that are faced by Amazon.com in managing global information systems.
Challenges Faced By Amazon.com in Managing Global Information System
Amazon.com is currently facing the risk of growth as it is experiencing massive problems as it tries to spread its retail business to new countries. Amazon.com's internal culture is too American as well as its staff code, and this has made it very difficult for them to offer pages in different languages. The language barrier is a significant challenge in the management of global information systems because they are unable to provide pages in different languages it has resulted in them snubbing some other countries which in the end is giving a chance to other players to gain sufficient market share outside of the United States (Graham, 2016). These other players have the potential to become so significant to the point that for Amazon.com to have a competitive advantage, they would have to buy the competitor at a substantial sum. The conducting of businesses across multiple continents means that they have numerous data processing centers because of this there could be two incompatible systems online at the same time causing the loss of data and failure of systems.
Fluctuations in money values is a constant challenge for Amazon.com which can result in a loss of profit margins for products that they get from other countries as well as those that they are shipping to other countries (Saunders, 2014). Amazon.com tries to put prices that are more customer friendly and still give them a profit even when the value of money fluctuates. Their global information system also faces the risk of malware which includes issues like dishonest spyware, computer viruses, worms, and Trojan horses. Hacking, in general, is designed to compromise the system which results in a breach of data, and this will cause Amazon.com to lose income, functionality and the confidence of its customers (Graham, 2016).
To ensure no hacking takes place, Amazon security features other companies the chance to piggyback on their cloud-powered security infrastructure. Another challenge that Amazon faces in the management of their global information system is natural disasters like earthquakes which can destroy their data center or even kill their key personnel resulting in the loss of data, institutional knowledge, or even sales. The last challenge is data ownership whereby they have to make the user understand that the information that has been stored does not solely belong to them. The information is stored on Amazon.com's cloud which is managed by them meaning that the data is owned by both Amazon.com and the user (Amazon, 2017). If the user does not understand the concept of shared information, Amazon.com risks losing its short term and long term clients within the boundaries of end-user agreements.
The proper management of global information system has enabled Amazon to improve customer experience by providing the necessary products needed by their clients. But for it to maintain a competitive advantage as the world's largest online retail store, it has to address the challenges that it is continuously facing and also provide products in other languages to satisfy customers from other countries. This will ensure that it grows and develops a market share that no other competitor can beat or come close to. It is only through the proper management of their customer's data that Amazon.com can be able to continue satisfying them as well as continue to expand.
Amazon Web Services, Inc. (2017). Amazon Web Services. AWS. Retrieved from https://aws.amazon.com/
Graham, J. (2016). Amazon's biggest challenge. The Huffington Post. Retrieved from https://www.huffingtonpost.com/john-graham/amazons-biggest-challenge_b_8062784.html
Saunders, R.,(2014). Business the Amazon.com way: Secret of the world's most astonishing web business. Hoboken, NJ: John Wiley & Sons.
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