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Global Supply Chain Analysis of Amazon.Com\'s Global

Last reviewed: May 18, 2013 ~3 min read

Global Supply Chain

Analysis of Amazon.com's Global Supply Chain

Date you turn this paper in Analysis of Amazon.com's Global Supply Chain

Amazon's supply chain management systems and processes are predicated on the synchronization of a diverse base of global suppliers, partners, logistics services companies and warehouse management systems and technologies. All of these elements of their supply chain strategy and infrastructure are orchestrated around delivering an exceptional customer experience and streamlining the ordering process for customers globally (Lapide, 2013). Amazon is consistently rated in Gartner's top 20 list of supply chains globally, as their metrics of performance reflect the company's ability to orchestrate across a broad base of suppliers globally while attaining profitability in a historically low-margin business (O'Marah, 2010). The intent of this analysis is to evaluate the key performance drivers, metrics and supply chain challenges of Amazon.com. The competitive strategy of Amazon.com is predicated on the precise synchronization of these systems, processes and a very clear definition of roles and goals for each of the departments integral to its supply chain performance (Lapide, 2013).

At the foundation of Amazon.com's supply chain-based business model is a demand management platform that including real-time forecasting and distributed order management integration tot the supplier level. This provides Amazon.com with the ability to interpret, analyze and aggregate demand for a given product, invoke its supply chain processes, place orders, manage inventory, or procure the item based on customer demand. These are the foundational elements of supply chain best practices as defined by supply chain theorists who underscore the need for creating a demand-driven forecasting and replenishment process that manages inventory effectively while fulfilling customer orders (Lee, Whang, 2004). Demand management and forecasting is a key performance driver within Amazon.com's supply chain system, as it is integrated to their analytics platform, which is used for global reporting of supply chain performance. Amazon.com was prescient in creating a distributed order management system that today runs as a Web Service (Lapide, 2013). All of these elements taken together are orchestrated to create state-of-the-art dashboards that include key performance driver assessment, metrics and analytics that in real-time show supply chain performance.

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References

13 sources cited in this paper

Amazon.com Investor Relations (2013). Investor Relations. Retrieved May 9, 2013, from Amazon.com Investor Relations and Filings with the SEC: http://phx.corporate-ir.net/phoenix.zhtml?p=irol-irhome&c=97664 ↗
Description: The last ten years of filings completed by Amazon.com with the Securities and Exchange Commission were analyzed, as were their latest annual reports. As Amazon is a very analytically-driven company their filings have an abundance of data in them.
Barrett, J. (2007). Demand-driven is an operational strategy. Industrial Management, 49(6), 14-19,5.
Description: Defines the Gartner Hierarchy of Supply Chain Metrics and the specifics of how this model is applied to distribution-centric businesses.
Bhagwat, R., & Sharma, M. K. (2007). Performance measurement of supply chain management using the analytical hierarchy process. Production Planning & Control, 18(8), 666.
Description: The researchers present their study of how empirical data including analytics and dashboards can guide the development of more effective supply chain strategies overall. Their focus is also on how to create a hierarchy of supply chain metrics as well that aligns to the specific needs of a business.
Chopra, S., & Meindl, P. (2010). Supply chain management: Strategy, planning and operation (4th ed.).Upper Saddle River, NJ: Prentice Hall , chapters 4, 5, and 6 (pages 68 – 177).
Hugos, M. (2003). Essentials of supply chain management. Hoboken, NJ: John Wiley & Sons.
Lapide, L. (2013). A tribute to the ever-evolving warehouse. Supply Chain Management Review, 17(2), 4-5.
Description: Larry Lapide is a researcher at MIT and works on their supply chain practices research. He has studied the Amazon.com supply chain for over a decade and shares his insights from a warehouse management perspective in this analysis.
Lee, H. L., and Whang, S. (2004) e-business and supply chain integration. In T.Harrison, H. Lee, and J. Neale (Eds.), The practice of supply chain management: Where theory and application converge (pp. 123-138). New York, NY: Springer Science & Business Media.
O'Marah, K. (2010). Winning Tactics: Lessons from the supply chain top 25. Supply Chain Management Review, 14(5), 14-16,18-21.
Description: Kevin O’Marah is the inventor of the Supply Chain 25 methodology at Gartner, and has since moved on to Stanford to continue his research on supply chains. This article encapsulates his ideas on supply chain management as it relates to Amazon and others.

Amazon.com Investor Relations (2013). Investor Relations. Retrieved May 9, 2013, from Amazon.com Investor Relations and Filings with the SEC: http://phx.corporate-ir.net/phoenix.zhtml?p=irol-irhome&c=97664 ↗
Description: The last ten years of filings completed by Amazon.com with the Securities and Exchange Commission were analyzed, as were their latest annual reports. As Amazon is a very analytically-driven company their filings have an abundance of data in them.
Barrett, J. (2007). Demand-driven is an operational strategy. Industrial Management, 49(6), 14-19,5.
Description: Defines the Gartner Hierarchy of Supply Chain Metrics and the specifics of how this model is applied to distribution-centric businesses.
Bhagwat, R., & Sharma, M. K. (2007). Performance measurement of supply chain management using the analytical hierarchy process. Production Planning & Control, 18(8), 666.
Description: The researchers present their study of how empirical data including analytics and dashboards can guide the development of more effective supply chain strategies overall. Their focus is also on how to create a hierarchy of supply chain metrics as well that aligns to the specific needs of a business.
Chopra, S., & Meindl, P. (2010). Supply chain management: Strategy, planning and operation (4th ed.).Upper Saddle River, NJ: Prentice Hall , chapters 4, 5, and 6 (pages 68 – 177).
Hugos, M. (2003). Essentials of supply chain management. Hoboken, NJ: John Wiley & Sons.
Lapide, L. (2013). A tribute to the ever-evolving warehouse. Supply Chain Management Review, 17(2), 4-5.
Description: Larry Lapide is a researcher at MIT and works on their supply chain practices research. He has studied the Amazon.com supply chain for over a decade and shares his insights from a warehouse management perspective in this analysis.
Lee, H. L., and Whang, S. (2004) e-business and supply chain integration. In T.Harrison, H. Lee, and J. Neale (Eds.), The practice of supply chain management: Where theory and application converge (pp. 123-138). New York, NY: Springer Science & Business Media.
O'Marah, K. (2010). Winning Tactics: Lessons from the supply chain top 25. Supply Chain Management Review, 14(5), 14-16,18-21.
Description: Kevin O’Marah is the inventor of the Supply Chain 25 methodology at Gartner, and has since moved on to Stanford to continue his research on supply chains. This article encapsulates his ideas on supply chain management as it relates to Amazon and others.

Amazon.com Investor Relations (2013). Investor Relations. Retrieved May 9, 2013, from Amazon.com Investor Relations and Filings with the SEC: http://phx.corporate-ir.net/phoenix.zhtml?p=irol-irhome&c=97664 ↗
Description: The last ten years of filings completed by Amazon.com with the Securities and Exchange Commission were analyzed, as were their latest annual reports. As Amazon is a very analytically-driven company their filings have an abundance of data in them.
Barrett, J. (2007). Demand-driven is an operational strategy. Industrial Management, 49(6), 14-19,5.
Description: Defines the Gartner Hierarchy of Supply Chain Metrics and the specifics of how this model is applied to distribution-centric businesses.
Bhagwat, R., & Sharma, M. K. (2007). Performance measurement of supply chain management using the analytical hierarchy process. Production Planning & Control, 18(8), 666.
Description: The researchers present their study of how empirical data including analytics and dashboards can guide the development of more effective supply chain strategies overall. Their focus is also on how to create a hierarchy of supply chain metrics as well that aligns to the specific needs of a business.
Chopra, S., & Meindl, P. (2010). Supply chain management: Strategy, planning and operation (4th ed.).Upper Saddle River, NJ: Prentice Hall , chapters 4, 5, and 6 (pages 68 – 177).
Hugos, M. (2003). Essentials of supply chain management. Hoboken, NJ: John Wiley & Sons.
Lapide, L. (2013). A tribute to the ever-evolving warehouse. Supply Chain Management Review, 17(2), 4-5.
Description: Larry Lapide is a researcher at MIT and works on their supply chain practices research. He has studied the Amazon.com supply chain for over a decade and shares his insights from a warehouse management perspective in this analysis.
Lee, H. L., and Whang, S. (2004) e-business and supply chain integration. In T.Harrison, H. Lee, and J. Neale (Eds.), The practice of supply chain management: Where theory and application converge (pp. 123-138). New York, NY: Springer Science & Business Media.
O'Marah, K. (2010). Winning Tactics: Lessons from the supply chain top 25. Supply Chain Management Review, 14(5), 14-16,18-21.
Description: Kevin O’Marah is the inventor of the Supply Chain 25 methodology at Gartner, and has since moved on to Stanford to continue his research on supply chains. This article encapsulates his ideas on supply chain management as it relates to Amazon and others.