Sample Business Studies Case Study on Amazon’s OLR

Question 1

The organization and leadership reviews (OLRs) done by Amazon motivate the employees to be the best they can be. The reason for that is the assured promise of promotion if they happen to perform over and beyond the expectations of the company and managers of the organization. The worst performing employees are also let go by the company. Employees in the lower ranks of the company are compelled to work harder and smarter if they want to continue working in the company. Amazon deals with complex logistic problems requiring intense cooperation among the various workers in the company. The ability to work as a team and fit in with others in the company is imperative. Moreover, the employees are required to have good working relationships with their managers and the peers of their bosses to improve the chances of retention. The overall effect this exercise is improved performance by the employees.

Question 2

Rater bias, stereotyping and trait appraisal are not likely to affect the accuracy of OLR. OLR does not use hard data to evaluate the performance of the employees. Instead the managers use non-quantitative approaches such as personal and anecdotal experiences they have had with the employees. Using these metrics enables the managers to determine with accuracy the character traits of the employees and identify the ones most likely to perform better when promoted. None of the managers has more authority than the peers in determining who is to get promoted. At the same time, all the managers have veto powers to prevent the promotion of an employee whom they are not comfortable with. This approach helps in motivating the employees to get along with all the managers if they want to progress in their career in the company. It also ensures employees with the best teamwork and social skills are retained in the organization.

Question 3

From the various appraisal systems that have been discussed in this chapter, Trait-Focused Performance Appraisal is the one that most closely resembles OLR. This approach considers the attributes specific to an employee, especially the ones that make the employee stand out in the organization. The traits include punctuality, dependability and helpfulness. The supervisors are the ones that make the evaluation with no input from the junior employees. The nonparticipation of the employees in giving inputs to the process is an additional similarity between Trait-Focused Performance Appraisal and OLR. The system of performance appraisal, however, has the drawback of being subject to the personal bias of the supervisors. This is resolved in OLR by having all the managers evaluate the usefulness of the employees as opposed to just a single supervisor. The veto powers given to the managers during OLR meetings ensures that only the best employees get promoted. Another difference is that Trait-focused performance appraisal is not used to determine the promotions or who gets laid off by the company.

Question 4

From the answer given above, the appraisal system already in place at Amazon (OLR) is the best in meeting the organization’s objectives. Comparison of the number of employees of the company with similar conventional companies proves that point. Amazon has managed to retain top talent while at the same time removing ineffective employees from the payroll. The approach has enabled the organization to perform better than its competitors while at the same time having a significantly smaller workforce. The employees retained have good knowledge of what is required to create positive customer experience and, in the process, achieve success for the company.

Question 5

Given the technology capacity of the firm, the company can improve the OLR process by including the input of the customers that have been served by the employees. The metrics used by this method include the communication, time taken to deliver, and condition in which the goods get to the customer. The behavior of the customer has also to be considered, as they are bound to be influenced by their personal biases when giving feedback to the company. The employees getting good reviews and repeat customers should be given priority when doing the performance appraisal. This can be done seamlessly given the technical prowess of the company. Lastly the company relies heavily on the coordination and teamwork of the workers in the warehouses to package and deliver the ordered goods. The employees should also have a chance to review the peers they have worked with on every order to assist the managers in making the right decisions.

Question 6

The merits of OLR approach include the recognition and retention of top talent in the company, elimination of deadweight in the workforce, and motivation of the employees who give their best to the company. The demerits of the method include making the employee feel pressured as a result of having their careers on the line. There are two outcomes at the end of the appraisal: promotion or getting laid off. This can torture the employees psychologically. Another demerit is the lack of participation of the employees in the process and having it all depend on the opinions of the managers.