Impacts of MIS on the Organization: Connecting the Dots
Three leaders from Amazon participated in interviews for this report, they are the Web Services Director, Andrew Jassey, the Business Development Director, Jeffrey Blackburn, and the Consumer Business Director, Jeffrey Wilke. I incorporated their views as part of this report.
1. How has the organization leveraged IT to assist in its decision making?
Amazon has implemented an IT customer services strategy that allows its customers to post reviews about products they have purchased on their website whether the reviews were negative or positive. Amazon was the first retailer to implement such a strategy way back when it started in 1994, which many in the bookselling industry criticized because they thought that allowing customers to post negative comments about their purchases would reduce sales (Cecez-Kecmanovic, Kautz & Abrahall, 2014). However, Jeff Bezos did not falter as his motivation for implementing the feature as part of the company’s strategy was to give customers access to as much information as they wanted that would assist them in making their buying decisions.
It is no wonder that up to now Jeff has a public email that all Amazon customers can use to get in touch with him about any complaints that they may have. All managers at the company live in perpetual fear of emails about customer complaints that are forwarded to them by Jeff usually with an additional question mark, which gives them just a few hours to resolve the complaint. It is not difficult  to see how IT has drastically impacted how the company makes decisions because according to Jeff, the customer is always right, which has driven many crucial changes in the company. Jeffrey Wilke, the Consumer Business Director remembers vividly an incident where Jeff Bezos, the founder, wanted them to scrap the whole email marketing system just because of one customer complaint.
Which systems provide the clearest support for analyzing data and determining strategic direction?
Amazon’s customer feedback system is the most important part of their strategic decision making  process as the company uses available data to make all  its strategic decisions such  as the introduction of Kindle e-readers and most of its products. Amazon uses information management systems as their core decision-making system as they take into account all the available information regarding customers, suppliers and their business partners to decide on what future strategies to implement. The company also tracks the information related to both their direct and indirect competitors, which is a key factor when they are deciding on what companies to buy and what partnerships they should enter into.
The early partnerships, which Amazon with established retailers such as Target, enabled the company to wield a unique advantage over its competitors by increasing their distribution networks significantly. In the company’s initial years it used basic information systems to keep track of customer behaviors, which paid of drastically as the company introduced new innovative solutions such as same day shipping for in-stock orders. The company’s information management systems are responsible for most of the strategic decisions made by Amazon as it has always used the data collected through the system to chart future strategies.
2. How has technology impacted the organization’s structure?
Technology has a huge impact on Amazon’s organizational structure given the fact that it is an online retailer and makes most of its sales through its various websites. One of the crucial changes the technology has had on the company is evident in the introduction of programs such as the associate program, which has contributed greatly to Amazon’s success through sales generated by its affiliates. Business Development Director, Jeffrey Blackburn states that technology enabled Amazon to host numerous websites operated by members of the affiliate program to make sales without which the company could not have generated the amount of sales and growth that it continues to experience up to date. Technology has also been crucial in the introduction of web services as Amazon has invested in web technologies so as to compete with companies such as Google and Hewlett Packard in the technology market especially by offering cloud services (Chen, Ramamurthy & Wen, 2012). The launch of the Kindle Fire and other Kindle devices has also been crucial in advancing Amazon’s strategy of increasing its market share given that the designers of the Kindle Fire tablet device wanted it to drive online sales made from tablets while at the same time competing with Apple’s iPad. The introduction of all these new products and services has affected the company through the creation of new departments such as the Web Services department, which has increased Amazon’s market share.
Technology continues to be the main avenue through which the company is diversifying its products and services creating numerous jobs and departments within the company as it keep expanding across many industries. Technology can have a significant impact on a company’s organizational structure given that just by the mere fact that a company is experiencing growth in its size, operations and market share the need for the adoption of information management systems keeps increasing (Cecez-Kecmanovic, Kautz & Abrahall, 2014). Initially when the company started there was no human resources department as Jeff managed all the company employees who operated from his garage and later on at an industrial park. However, if he tried to do the same today with the significant size of the company’s operation and a workforce of 132,600 employees as of June 2014, he would be a miserable failure at such a task. Amazon employees the best human resources to manage its huge workforce not forgetting that the department is largely dependent on information management systems to keep track of all its employees and address employee issues. Without information management systems, Amazon would not be a profitable organization like it is right now.
3. What security risks have IT systems created that were not there before and how has the organization addressed these issues?
Cloud security systems risks
The advent of cloud services that are catching up with other technologies for storing data in the market has been touted as a rick free way of storing data and accessing it easily on demand at less cost than storing it yourself (Cecez-Kecmanovic, Kautz & Abrahall, 2014). However, recent studies indicate that cloud services are not as impenetrable as they were once thought to be and that hackers can still illegally access cloud servers that are not properly protected. According to Andrew Jassey Amazon’s Director of the Web Services, this is a new security threat that is facing Amazon as they recently launched their web services division and are providing cloud services to both their individual consumers and corporations such as Dell. Other affiliates using the company’s web infrastructure are also at risk because these systems utilize cloud computing systems.
Social engineering risks
Social engineering threats involve the use of methods such as phishing by cyber criminals to get access to financial information, which they can exploit and steal mostly from consumers and innocent web users (Géczy, Izumi & Hasida, 2014). Phishing involves the use of mirror sites that are identical to the real Amazon site to dupe customers into thinking that they are purchasing products from Amazon, while on the contrary, it is the cyber-criminal who is taking their money. Phishing sites have greatly increased, especially after Amazon launched different sites in countries such as the UK and Germany, which attackers are finding easier to copy. Another major contributor to this threat is the fact that domain names nowadays contain characters in Japanese, Hindi and other languages.
Mobile devices risks
Mobile devices make up the newest frontier in terms of security threats in IT systems especially given the fact that more and more consumers are making purchases from mobile devices such as smart phones and tablets (Briggs, 2014). In most cases it is difficult to implement the same level of security in a mobile device because of limited processor capacity and memory space, which is what cyber criminals are using to their devices. This threat is extremely relevant to Amazon given that Kindle purchases in recent years have exceeded purchases through its main website. Amazon also has iPhone and iPad applications in addition to android applications that are extremely vulnerable to cyber-attacks because of limited security.
Malware risks
Although malware is not a new problem since it has been present since the invention of computers it has kept evolving with hackers developing newer viruses designed to beat even the most sophisticated computer security systems (Géczy, Izumi & Hasida, 2014). The impact of malware on information systems is as crucial today as it was decades ago given that it is the most effective way to profits from cyber-crime by infecting an organization’s information system and acquiring information, which the cyber-criminals use for financial fraud. Although Amazon has one of the best if not the best firewall systems in the world, which is higher than military grade software, it is still vulnerable to malware attacks.
Misuse of web applications
Another threat faced by Amazon is the misuse its web applications, especially those hosted by third parties where the company has no control over the security systems used for such applications. Amazon has tried to reduce this risk by controlling the security of those web applications hosted and operated by third parties, mostly be acquiring rights to the applications or by acquiring the third party itself.
Has Amazon implemented a planned risk management approach?
Amazon has implemented a planned risk management system of which a great portion focuses on the security of its information systems, while the rest is dedicated to the security of its other business assets such as its distribution networks and its brand (Spears & Barki, 2010). The core principle of its information security risk management strategy involves continuous monitoring and evaluation of its firewalls and the hacking threats made to penetrate the firewalls on a daily basis (Géczy, Izumi & Hasida, 2014). Amazon has also implemented intruder detection systems at all access points to its information systems so that in case an intruder penetrates and access the entry  point of the system the systems security department is notified of such intrusions that are quickly addressed. However, the bigger part of the risk management system is based on the preventative measures of continuous evaluation and improvement of existing systems so as to  prevent the occurrence of the identified security  systems and any new threats.
Amazon’s risk management flowchart
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MERGE FORMATINET 

What business risks are involved, if any, and how did/does the organization respond?
The main business risks that face Amazon are technology risks, which is an external risk, while other internal risks include financial, employee, innovation and strategic risks (Deng, & Chi, 2012). The most prominent risks are the financial, innovation and strategic risks. For many years Amazon operated at a loss given that its priority was on increasing its market share instead of making profits. This was especially worrying for its investors in the late nineties as many dotcoms went bankrupt and lost significant amounts of investors’ capital. The company averted this risk briefly in 2001 when it made its first net profits in the fourth quarter. However, profitability has not been consistent through the years, but Jeff and the company executives have always maintained a positive outlook with the support of their investors who have seen the value of Amazon shares increasing over the years. The company has responded adequately to the financial risks by constantly increasing the annual sales of the company up to $74.5 billion in 2013. The company keeps taking calculated strategic risks as it ventures into new industries based on the driving principle of selling everything at affordable prices, which has seen it recently launch the Kindle Fire to compete with Apple’s iPad and other similar tablets.
4. What new technologies will most likely directly impact the organization’s business?
New technologies that are most likely to impact the organization’s business are extremely likely to be in the mobile devices industry, which is the next frontier of technology growth in the near future (Hui, Hui & Yue, 2012). However, the company is already way ahead of its direct competitors in the retail industry in terms of mobile technology through its highly advanced mobile platforms and applications, not forgetting its innovative Kindle devices. Given its diverse portfolio of products and services it is highly unlikely that any new technologies could drastically disrupt the company’s operations, especially under the leadership of their CEO, Jeff Bezos, who is a believer in innovation. It is hard to foresee any new technologies catching Amazon executives by surprise given the nature of their operations, what is more likely to happen is that Amazon will create new disruptive technologies that will cement its position as a market leader.
Will the organization be likely to adopt new technologies to achieve a competitive edge or take a wait-and-see attitude?
The most likely scenario is that if any new technologies come into the market, Amazon will be among the very first companies to adopt the new technologies so that they can gain a competitive advantage over their rivals. This prediction is based on the fact that Amazon has embraced many new technologies and even used those to launch new products such as the web services division, which offers cloud services that are not part of the general retail industry. All the three directors interviewed strongly support the fact that Amazon would never adopt a wait-and-see attitude in any of the industries it operates in given that it has always prided itself on being a pioneer and market leader.
What are the advantages and disadvantages of each approach?
The main advantage of a wait-and-see approach is that it allows a company to adopt a new technology when others in the industry have already adopted the technology and it is working quite effectively for those who have adopted it. However, there is a downside to this approach in that a company may wait for too long before adopting a technology only for it to lose significant market share as its competitors benefit from adopting the new technologies much earlier. The main advantage of quickly adopting new technology is that the company can jump ahead of its competitors and capture new markets created by the introduction of the new technologies way before it can face stiff competition from other competitors (Twyman, Elkins, Burgoon & Nunamaker, 2014). The main disadvantage associated with this approach is that a company might adopt a new technology way too early, invest significant resources in the new technology only for the technology to become obsolete. Such scenarios are extremely common as was evidenced in the dotcom bubble burst of the late 1990s and the financial crash of 2008. However, Amazon has benefitted greatly from taking significant risks and this should not change in future.

 
References
Cecez-Kecmanovic, D., Kautz, K., & Abrahall, R. (2014). Reframing Success and Failure of Information Systems: A Performative Perspective. MIS Quarterly, 38(2), 561-588.
Hui, K., Hui, W., & Yue, W. T. (2012). Information Security Outsourcing with System Interdependency and Mandatory Security Requirement. Journal Of Management Information Systems, 29(3), 117-156.
Géczy, P., Izumi, N., & Hasida, K. (2014). Analytics-Based Management of Information Systems. Review of Business & Finance Studies, 5(2), 55-65.
Twyman, N. W., Elkins, A. C., Burgoon, J. K., & Nunamaker, J. F. (2014). A Rigidity Detection System for Automated Credibility Assessment. Journal Of Management Information Systems, 31(1), 173-202.
Briggs, R. O. (2014). Special Section: Information Systems Support for Shared Understanding. Journal of Management Information Systems, 31(1), 107-110.
Deng, X., & Chi, L. (2012). Understanding Postadoptive Behaviors in Information Systems Use: A Longitudinal Analysis of System Use Problems in the Business Intelligence Context. Journal Of Management Information Systems, 29(3), 291-326.
Chen, Y., Ramamurthy, K. K., & Wen, K. (2012). Organizations’ Information Security Policy Compliance: Stick or Carrot Approach? Journal Of Management Information Systems, 29(3), 157-188.
Spears, J. L., & Barki, H. (2010). User Participation in Information Systems Security Risk Management. MIS Quarterly, 34(3), 503-A5.