By John Dudovskiy
March 22, 2022
Amazon organizational structure can be classified as hierarchical. Senior management team include three CEOs and three senior vice presidents responsible for various vital aspects of the business reporting directly to CEO Andy Jassy.
Amazon organizational structure has the following four key features:
1. Hierarchical corporate structure. Hierarchical structure at Amazon has developed due to the immense size of the business. The largest internet retailer in the world by revenue employs more than 1,3 million people worldwide.[1]
2. Hybrid project groups. Amazon corporate structure integrates hybrid project groups when developing new products and services. Specialists from various departments are attracted according to their skills and competencies required for the project. These employees can be attracted part-time reporting to both, the head of their departments and project leaders, or they can engage in the project full-time reporting to project manager only for the duration of the project.
3. Flexibility of the business. It is important to note that despite its large size, unlike many other companies with hierarchical organizational structure, Amazon remains highly flexible to adapt to frequent changes in the external marketplace. Moreover, the online retail giant leads changes in external business environment; it has caused disruptive innovation in e-commerce and currently it is about to cause a disruptive innovation in global logistics industry. Successful organization of hybrid project groups plays an instrumental role in maintaining flexibility of the business.
Amazon organizational structure integrates many small teams that deal with various aspects of the business. Amazon founder and former CEO Jeff Bezos is credited with the introduction of ‘two pizza rule”. According to this rule, meetings should be held in teams small enough that could be all fed with only two pizzas. “Two pizza rule” continues to this day under the new CEO Andy Jassy.
4. Stability in the top management. Stability is one of the key features of Amazon. Specifically, thelargest internet company by revenue experiences “very little turnover among its most important power players, with many of them having been at the company for years, if not decades.”[2] This is rather unusual for contemporary companies, where changes in senior management team have become a frequent phenomenon.
Figure below illustrates Amazon organizational structure:
Amazon Organizational Structure
It can be argued that due to the company’s adherence to business diversification strategy in an aggressive manner, its organizational structure will remain dynamic, being subjected to certain changes in a regular manner. Moreover, the online retail behemoth is faced with the challenge of maintaining the flexibility of the business, as well as, the fast pace of decision making despite the growing complexity of the business.
Amazon.com Inc. Report contains the above analysis of Amazon organizational structure. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on Amazon. Moreover, the report contains analyses of Amazon leadership, business strategy and organizational culture. The report also comprises discussions of Amazon marketing strategy, ecosystem and addresses issues of corporate social responsibility.
[1] Annual Report (2019) Amazon Inc.
[2] Kim, E. (2019) “Amazon’s executive org chart, revealed” CNBC, Available at: https://www.cnbc.com/2019/01/23/who-are-amazons-top-executives-2019.html
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