A virtual organization operates its business mostly through telecommunication and electronic media. Venture organizations have a lower physical presence and member of them usually work by information technology such as
internet and e-mail then a physical presence and interaction in office. In recent times, organizations are looking at virtual organizational model to reduce resources, personnel and logistical issues (Warner & Witzel, 2004). Customers use virtual organizations for almost every day to purchase products and services on the internet. For this Virtual Organizations business assignment help, Amazon.com and eBay Inc are virtual organizations that are selected.
Amazon.com is an American multinational electronic commerce company that was originated as on online bookstore. Amazon’s product lines includes books, software, CDs, DVDs, kitchen items, toys and games, sporting goods, baby products, beauty products, clothing, etc. It was incorporated in 1994 and launched web auction services in March, 1999. Company uses different versions of the website for different countries such as amazon.co.uk, amazon.jp, amazon.fr, amazon.de, amazon.cn, amazon.ca, India.amazon.com, etc (Amazon.com, Inc, 2012). The company provides variety of products with different features that help customers to make better buying decision. Global customers book products and services of company by the use of internet and company fulfills customer demand through home delivery facilities. Amazon attracts approximately 615 million global customers to its website. Company invested heavily amount of service capacity for its website to handle the high traffic during the vacation and holiday season (Lussier, 2011).
Virtual operating model allows Amazon.com to operate efficiently and entry into new categories quickly. eBay Inc is an American multinational internet corporation. It is an online auction and shopping website though which customers and businessmen buy and sell variety of products and services worldwide. Variety of products such as appliances, computers, mobiles, decor, vehicles, equipment and other items are listed, bought and sold daily through eBay website. Company uses separate sites for separate countries such as eBay US and eBay UK to allow the customers or users for trading in local currency (eBay Inc, 2012). The company has millions of registered users with 15000 employees worldwide. Organizational Model Amazon is the largest online retailer in US that is started as an online bookstore, but soon diversified in selling DVDs, CDs, MP3, computer, video games, furniture, food, etc.
Amazon.com uses matrix organizational model to ensure that all the processes and production operations within the company are stabilized and performed effectively. Company uses matrix organizational model to divide authority both by functional area and by division area. Top management divides responsibility through function areas such as operations, selling services, web services, IT, marketing, etc and division area such as China, Europe, India, North America, etc. Each major category, function and country has its own manager. The management is given proper order and positioning in each division and department inside the organization (Bacon, 2011). Through matrix model, organization controls or manages the each department and division of business effectively worldwide. Matrix organizational model allows Amazon.com for better efficiency and to provide products and services for global customers. EBay divides its operations in different functions such as finance, human resources, legal, communication, advertising, IT, etc that represents that company uses the functional organizational model. Functional structure is the most common type of structure design and concept, which is technology oriented and less production or business oriented organization. In context of eBay, decision-making power is centralized at the top of the hierarchy.
Top management is responsible to control each unit and maintain coordination among them. Management of company using business assignment help to divided responsibility and authorities by functional area. All the functional managers report directly to the top management of company (Griffin, 2011). EBay uses functional structure to put all the informational resources for a single activity in one place. It is beneficial for eBay to effectively utilize and manage the human and informational resources. Amazon.com and eBay both are virtual organizations those provides online auction facilities to customers worldwide. Both organizations use different organizational models as Amazon uses matrix and eBay uses functional structure. Matrix organization model is most appropriate and effective model for virtual organizations, which provide online retailer facilities to customers. Matrix structure allows the transformation of information and resources more smoothly between different functional and divisional areas. Matrix model can create power struggles in organization because in this model both functional and divisional manager working at same level and covering each other’s area that reduces the probability of error (Gido & Clements, 2008). Matrix method is beneficial for large organizations, those provide variety of products and services worldwide, so it is effective for Amazon.
Functional model is generally used in small size organization, so it is not effective for eBay, Inc. Both organizations operate its business in different countries with separate website and several functions, so matrix organization model is effective for both of them. One of the advantages of implementing the matrix structure is that it can effectively exchange the all necessary information timely and effectively, which increase the decision making and business operations. In matrix structure, different departments and functions work closely and communicate with each other frequently (Kerzner, 2009). Maintaining communication and exchanging information through technology is an essential aspect for the success of virtual organization, so matrix organizational model would be most effective for eBay and Amazon both.
References- Amazon.com, Inc. (2012). Your Amazon.com. Retrieved from: http://www.amazon.com/ Bacon, T.R. (2011). The Elements of Power: Lessons on Leadership and Influence. USA: AMACOM Div American Mgmt Assn. eBay Inc. (2012). My eBay. Retrieved from: http://www.ebay.com/ Gido, J. & Clements, J.P. (2008). Successful Project Management (4th ed.). USA: Cengage Learning. Griffin, R.W. (2011). Fundamentals of Management (6th ed.). Canada: Cengage Learning. Kerzner, H. (2009). Project Management: A Systems Approach to Planning, Scheduling, and Controlling (10th ed.). USA: John Wiley & Sons. Lussier, R.N. (2011). Management Fundamentals: Concepts, Applications, Skill Development (5th ed.). USA: Cengage Learning. Warner, M. & Witzel, M. (2004). Managing in Virtual Organizations. UK: Cengage Learning EMEA. Assignmenthelpexperts.com is the most popular website for solving management cast study assignment help and business assignment help. We have wide experience of writing assignment on case study that makes us perfect for solving assignment.