In this page we use CAS theory to review the asymmetric
challenges of the retailer Amazon.
understood a key opportunity of the Internet early on. If
you can browse for details of books you might want to read
online and then seamlessly purchase and obtain your selections
you have an interesting alternative to a book store.
Adding near infinite inventory with low prices to the offer
tilted the competitive advantage to Amazon. But to deliver
on this formula Amazon had to develop a low cost supply chain
coupled with superb supply chain management systems.
The power of a new weapon and an aligned strategy
moved early to develop great web infrastructure to make online
book buying a pleasure is the outcome of the dopamine reward system, argues UCSF professor Robert Lustig. He, like the early Christians, contrasts [addiction oriented] pleasure with serotonin driven happiness & contentment.
It coupled the new competitive weapon of web software with a new
strategy of how a book seller should operate using this
weapon. And then it added extra strategies to keep its
The Kindle allowed Amazon to extend its web site relationship
with users to the selection, delivery and e-reading
Its competitors were left trying to cope with:
- The added costs of physical book shops,
- A lack of experience of building great web sites and
supply chain planning systems
- No technical understanding of e-readers
Amazon's core skill set naturally extended into adjacent
technologies, and supply chain infrastructure. This
transformation increased the strategic pressure on its
competitors. And then the Amazon prime
This page reviews the strategy of setting up an arms race. At its
core this strategy depends on being able to alter, or take
advantage of an alteration in, the genome
or equivalent. The situation is illustrated with examples
from biology, high tech and politics. evolutionary amplifier provided
further strategic leverage, even presenting Wal-Mart
with a potential threat.
The constraint caused by phenotypic alignment
But the New York Times 16 August 2015 article "Amazon's
Bruising, Thrilling Workplace" highlights one challenge for
Amazon and the Fire phone another.
For me the New York Times investigation illustrates how
This page reviews the inhibiting effect of the value delivery system on the
expression of new phenotypic
effects within an agent. extended phenotypic alignment
constrains the operations of Amazon's value delivery
system. It shows:
And so the disastrous investment in the fire phone becomes of no
surprise. Who would tell the senior managers, with so much
power over them, that the executives were wrong about the
attractiveness of the phone offering?
- Even though Amazon seeks to hire the best candidates for
its white collar workforce it requires that they fit its
model of success - secrecy about the company, crazy long
hours, focus, speed, conflict, snitching, openness to
inspection from above, 'purposeful Darwinism'; the Times
even includes the bizarre assertion "Conflict brings about innovation is the economic realization of invention and combinatorial exaptation.
- Data-driven management extended into the workplace making
it 'infused with transparency and precision about who is
really achieving and who is not.' It sounds logical
but it can so easily enable tyranny. Ulcers, being
forced out when: ill, distracted by outside trauma,
pregnant; all highlight tyranny in operation. And
tyranny leads to panic not
Good ideas are successful because they build upon prior
developments that have been successfully implemented.
Johnson demonstrates that they are phenotypic expressions of
memetic plans subject to the laws of complex adaptive systems (CAS). creativity.
Competitive horizontal solutions will emerge
But these are problems of too much success. Soon Amazon
will have to ensure that its end-to-end model can perform as
well as competition built from a set of horizontal
partners. Amazon will have to leverage synergies from its
value delivery system. Its apparently combative workforce
will have to cooperate and identify ways to counter
competitors. Competitors who highlight the conflicts of
interest inherent in Amazon's business:
Possibly the New York Times investigative reporters have been
misled. Maybe Amazon is really building a creative and
dynamic workforce that will identify additional strategies to
subdue their current and future competition. Maybe that
explains the meteoric rise in Amazon's share price. Time
- Microsoft Azure web services can assure Amazon competitors
that it is not hosting Amazon's internal business
- Apple, Microsoft and Google phones and tablets will use
Moore's law to chip away at the Kindle e-reader hardware
advantages while applets will provide creative alternatives
to the reader and its book delivery mechanism. The
Kindle could easily become a costly anchor that Amazon will
have to invest in to defend.
- Supply chain management specialists like Wal-Mart
will seek to undermine the investments that Amazon is making
in physical warehousing.
Politics, Economics & Evolutionary Psychology
Nature and nurture drive the business eco-system
Emerging structure and dynamic forces of adaptation
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