Motivational techniques used for employees at

Amazon
Submitted in partial fulfillment of the requirements
for the award of the degree B.Com.,LLB (Hons)

Submitted by:
J.Sriprasad
Reg.No.BC0160048
3rdyear B.Com.,LLB(Hons)

Submitted to:
Dr.P.Kumaresan
Assistant Professor in Commerce

TAMIL NADU NATIONAL LAW UNIVERSITY

(A STATE UNIVERSITY ESTABLISHED BY ACT NO.9 OF 2012)

Navalurkuttapattu, Srirangam (TK), Tiruchirappali-620009, Tamil Nadu

1
 Contents
Declaration

Particulars Pg.No

 Research Methodology…………….………...…………………………………….4

 Introduction……………………...………...……………………………………….5

 About Amazon……………………………………………………………………..6

 Motivational Strategies at Amazon……………………...…………………………7

 Conclusion…………………………………...…………………………………...15

 Bibliography……………………………………………………………………...16

2
 Research Methodology

The project has been done with primary source of information. The various kinds of motivational
techniques used at amazon have been collected from the employees at Amazon. The primary
source of information has been collected from Amazon by observation and interviews.

3
 Introduction

The word motivation is derived from Latin word “Movere” which means to move. Motivation
means a process that starts with a physiological or psychological deficiency, or need that
activates behaviour or a drive that is aimed at a goal or incentive. Motivation is an internal
driving force which results in persistent behaviour directed towards a particular goal. People who
are motivated are driven by a desire to achieve the goal that they perceive as having value to
them. Motives are expressed needs and could be conscious or subconscious.1

Performance, output and productivity form the backbone of an organization. High performance,
high commitment and loyalty are the primary expectations of organization. Individual
performance is a function of the product of ability and motivation. Ability refers to competence,
skill or knowledge. The interaction of the basic abilities with motivation leads to performance.2

Needs are created because of the physiological or psychological imbalance. The physiological
process in the body sometimes creates deprivation which leads to creation of a need. The needs
get fulfilled through drives. Physiological and psychological drives are action printed and
provide an energizing thrust toward reaching an incentive. At the end of motivation cycle is the
incentive. Incentive is anything which we alleviate the need and reduce the drive. So by attaining
an incentive we tend to restore physiological and psychological balance. Once it is fulfilled it
will not stop, it will definitely lead to some other need.3

The needs are satisfied with incentives. The rewards can be either financial incentives or non-
financial incentives. Financial incentives- These are extrinsic to work such as pay and allowance
and cash rewards. These are effective when employees are from lower sections of society, or the
production is stable, or when productivity is easily measurable. Non-Financial Incentives- These
are intrinsic to work such as job satisfaction, delegation, empowerment and etc. These rewards
are much more effective than financial rewards in motivating the employees.

1
BiswajeetPattanayak, Human Resource Management, 4th Ed. 2014 PHI Learning Private Limited
2
P.Jyothi, D.N.Venkatesh, Human Resource Management, 2nd Ed. 2012 Oxford University Press
3
Supra Note 1

4
 About Amazon
Amazon was started in the year 1994 by Jeff Bezos. It was claimed to be the largest online book
store. Later in the year 2000 the business was diversified. Amazon has all products from A to Z.
Presently it has become one of the largest online retailer.

Amazon India empowers small and medium-sized businesses to reach millions of customers
across the country with a variety of programs that help to increase their revenue, reach and
productivity. By telling stories from a wide range of perspectives, they tell the larger story of
who Amazon is and how Amazon's core business practices contribute to a better India.From
selling globally to locally, from making money at Amazon website to expanding the business,
Amazon has a lot of wonderful opportunities for people to explore.

Amazon deeply cares about the communities our employees call home. They lookout for
uniquely Amazonian and innovative ways to make positive, lasting impacts and encourage our
employees to champion causes they care about. Amazon has framed its own unique 14 principles
of motivation and leadership for the betterment of the employees.

5
 Motivational Strategies followed at Amazon

Are Right, A Lot

The leaders are right a lot. They have good instincts and strong judgment. They seek diverse
perspectives and work to disconfirm their beliefs. The employees are motivated by their leaders
to provide their own decision. The perspective and opinion of each employee at amazon is
considered and scrutinized. A person cannot always be right in taking decisions. There is a
possibility that a boss in some cases may take a wrong decision. So he has to take suggestions
from the employees in his team also. The boss will take the valuable suggestions of employees
into account while making major decisions. When the suggestion given by the employee is very
useful, the amazon will be giving some reward to that particular employee.

Health

Amazon’s medical plan options to employees provide flexibility to select the right health care
coverage for its employees and their eligible family members. They are free to choose from
several plans, like a Health Savings Account (with both employee and employer contributions),
and multiple network providers for the best care in their region. They can also join any Dental
and Vision plans and many more Flexible Spending Accounts for health and dependent care.
When the employees visit some particular hospital, they are eligible for discounts in the hospital
bills. Suppose if they are not eligible for such discount, then they can claim reimbursement from
their company. These kind of schemes motivates the employees to perform their task better.

Financial Security

Amazon’s financial security plan provides the employees with an opportunity to defer
compensation for their long-term savings and includes a company match. The plan offers to the
employees a variety of investment options which will definitely help them to reach their financial

6
goals. The company also provides additional options by which the employees get coverage for
Accidental Death, Company-paid basic life and Dismemberment Insurance. The employees also
get the benefit of short term and long term Disability Insurance. These kinds of non-financial
incentives motivate the employees to fulfill the objectives and goals of the organization. For
those people who come from poor family background, this will definitely motivate to improve
their performance.

Ownership

Leaders are owners. They think long term and don’t sacrifice long-term value for short-term
results. They act on behalf of the entire company, beyond just their own team. They never say
“that’s not my job." The activities of an employee are not just restricted to their own team.
Suppose in case of necessity, they act for another team also. The employees at amazon have a
goal for long term and in no case they sacrifice their long term goal for a short term one. They
act like owners of amazon. Then only they will not be lethargic in their work and decisions. They
will also perform the work for their own benefit and for the benefit of Amazon. If they consider
themselves as the owners then there will be sincerity in the work done. Goals can be achieved in
a timely manner.

Time Off

Amazon provides Time Off to all the employees. Regular time away from work is most essential
for employees to refresh, recharge and renew. Employees are given 20 days of paid holiday
every year. Apart from this, they are also provided with paid medical holidays. Employees also
earn paid time off in addition to company paid holidays. This will improve the efficiency of the
employees and it will also be a great benefit. This is a main form of motivation to the employees.

7
Invent and Simplify

Leaders expect and require innovation and invention from their teams and always find ways to
simplify. They are externally aware, look for new ideas from everywhere, and are not limited by
“not invented here". Because we do new things, we accept that we may be misunderstood for
long periods of time.They lookout for easier ways to perform difficult tasks. The boss will
always want his team of employees to come up with innovative methods to make reach the goals
which are already set. Innovative ideas are accepted from everyone at amazon. Even if a lower
rank employee gives a brilliant idea it will definitely be taken by the leader. Each team at
Amazon will be given certain team goals which are required to be achieved in a limited duration
of time. So the bosses expect the employees to come up with very innovative and simpler ways
to achieve it.

Maternity and Paternity Leave

Amazon offers to its employees a wide range of fully paid Maternity and Paternity Leave options
both before and after the birth or adoption of a child. It also offers a unique leave sharing option
with a flexible return-to-work program which is ramp back. But this kind of leave is not
available to all the employees. These options of leave require at least one year of continuous
service on the date of birth of the child or adoption request letter.

Learn and Be Curious

Leaders are never done learning and always seek to improve themselves. They are curious about
new possibilities and act to explore them. Leaders at Amazon are not those who know
everything. They have the capabilities and willingness to improve their skills. The department of
human resource management at Amazon provides various training to its employees. These
training help the employees to enhance their career opportunities. The employees at amazon
never have a stop in their learning process. They learn daily experiences also. Their daily
experiences help them to learn further and improve themselves in all aspects.

8
Adoption Assistance

Amazon provides adoption assistance to employeeswho are eligible for domestic and
international adoption. It takes care of the expenses including attorney fees, court costs and
travelling expenses. It provides necessary details regarding the procedure of adoption and it
makes sure that the employees complete all the required procedures correctly. This is a
motivation for those employees who do not have a child. When the employees perform better,
they will ultimately get the offers and assistance.

Hire and Develop the Best

Leaders raise the performance bar with every hire and promotion. They recognize people with
exceptional talent and willingly move them throughout the organisation. Leaders develop leaders
and are serious about their role in coaching others. In order to hire 1 employee at Amazon, nearly
100 candidates will be selected from a pool of applicants. Then various oral and written tests will
be kept in order to test the skill, aptitude, intelligence and other required traits of the candidates
and only 7 candidates will be selected based on their performance. Then those 7 employees will
have 3 rounds of interviews with some managers and finally only 1 employee who is perfect for
the job will be selected. This method is done at Amazon so that they get the best employee and
develop them to reach targets.

Insist on the Highest Standards

Leaders have relentlessly high standards - many people may think these standards are
unreasonably high. Leaders are continually raising the bar and driving their teams to deliver high
quality products, services and processes. Leaders ensure that defects do not get sent down the
line and that problems are fixed so they stay fixed. Only when there are high standards fixed, the
employees will work hard to achieve the tasks. Raising the bar helps very much to improve the
standards of the employees. When high standards are fixed, the employees at Amazon will reach

9
the goals effectively and efficiently. At Amazon high standards means high quality of products,
services and processes. So high standards are always required to achieve difficult goals.

Network of Support

Amazon cares about theemployees’ health and well-being during the job and when not on the
job. The benefits which are provided to the employees are available to them without incurring
any cost on them.Amazon offers 24*7 free employee assistance program with confidential
support and it also provides for resources and assistance to the employees in both their personal
and work life. If children or parents of employees suffer from any disability then it provides
online references to help them to take care of them in a proper manner. Amazon also provides
financial counseling, financial planning and other necessary services in case of life threatening
disease or death. This will definitely motivate the employees to reach the goals of the
organization.

Think Big

Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold direction
that inspires results. They think differently and look around corners for ways to serve customers.
They employees at amazon are motivated to think outside the box. Their way of think should not
be narrowed to a very particular area. It has to be wide and broad. Their thinking must be
expressed to their boss. The thinking of the employees may result in a substantial cost reduction.
When the thinking of employees is very wide, it will be very effective and Amazon will be
rewarding for the most innovative idea. There must be sharing of ideas between the boss and his
employees. Thus by thinking big, it results in tremendous ideas.

Employee Discount

At Amazon the employees receive an annual discount on all those products which are sold and
shipped by Amazon.com. Some employees consider this as their main source of motivation
because they will be able to purchase everything under one roof.

10
Bias for Action

Speed matters in business. Many decisions and actions are reversible and do not need extensive
study. We value calculated risk taking. The employees at Amazon are motivated to take major
decisions. Almost all decisions of the employees are considered without a detailed analysis.
When the decisions taken by the employees are implemented, there is always a chance to reverse
the decisions taken. Risk taking is an important element. So there is a path for speedy decisions
for urgent matters.

The ABC’s of motivation

At amazon the ABC’s of motivation are Autonomy, Belonging and Competence. These are the
components of Self-Determination Theory which is a theory of motivation with decades of
research supporting its efficacy. By this theory, all human beings require regular experiences of
autonomy, belonging and competence, and when these are done in a proper manner, it leads to
thriving and positive motivation to the employees. Motivation rooted in autonomy and it has
been found to promote greater conceptual understanding, better productivity and less burnout at
work, healthier lifestyles and behaviors, and higher levels of psychological well-being.

Earn Trust

Leaders listen attentively, speak candidly, and treat others respectfully. They are vocally self-
critical, even when doing so is awkward or embarrassing. Leaders do not believe their or their
team’s body odour smells of perfume. They benchmark themselves and their teams against the
best. At Amazon they motivate the employees to have a trust and they listen carefully to the
voices of the employees. They make sure that all the voices of the employees are heard
irrespective of the position which they hold in the office. They treat all the employees in the
same manner by not considering their position.

11
Offer FAST feedback

At Amazon theexpansion of the acronym FAST stands for Frequent, Accurate, Specific and
Timely. At Amazon Fast feedback allows the employees to show up at more formal reviews
knowing exactly where they stand with the hope that some corrective actions can be taken. With
the help of feedback, the standard of the employees can be determined.

Have Backbone; Disagree and Commit

Leaders are obligated to respectfully challenge decisions when they disagree, even when doing
so is uncomfortable or exhausting. Leaders have conviction and are tenacious. They do not
compromise for the sake of social cohesion. Once a decision is determined, they commit wholly.
At Amazon the employees are free to disagree with the decision. When they disagree with the
decisions, they are required to provide comprehensive details for the disagreement. When the
reason has some validity on the face of it, then it will be accepted. The employees need not
accept it just for the sake of it. The only thing which they require is a determination to reach
goals.

Restricted Stock Units (RSUs)

At Amazon, the employees are given an opportunity to become an owner of the Company by
granting and vesting of Restricted Stock Units. It is a key part carefully designed including the
total compensation to help us attract, motivate and retain employees of the highest caliber. But
this opportunity is not given to all employees. This is a unique method to retain the extraordinary
employees from leaving the organization. It is not a privilege to all existing employees but a
mere right in the management to give it to THE BEST employee.

12
Career Choice

Amazon provides innovative career choice programs to its employees in hourly basis. For this
programAmazon pre-pays 95% of the cost of tuition and textbooks fees so employees can focus
on their studies and not on the incidental expenses which are incurred. These programs help the
employees to develop in-demand skills for professions of the future which may include even
medical technicians, paralegals, robotics engineers and solar panel installation professionals.

Keep teams small

The Two Pizza Rule is a very famous at Amazon. A team should not be larger than can be fed
with two large pizzas. This means that task for a team is limited to just five to seven employees.
This allows the teams to test their ideas without too many onlookers, which guards against
groupthink. It has been proved that only small teams have led to big innovations.

Deliver Results

Leaders focus on the key inputs for their business and deliver them with the right quality and in a
timely fashion. Despite setbacks, they rise to the occasion and never compromise. At Amazon
the employees are required to focus on the key inputs for their business. The employees must
finish the tasks at the right time. The employees will be effectively and efficiently motivated to
reach the goals in timely manner.

Other motivational techniques at amazon are: The employees are given free milkshakes daily,
food coupons are given for every month, smart card is given to take any electronic product for
free of cost, can claim reimbursement of petrol, telephone and internet bills, can play table
tennis, billiards, chess and carom to relax from the stressful working hours. All these motivate
the employees to work harder and remain at Amazon.

13
 Conclusion

This paper provides an insight into the motivational strategiesused by Amazon to motivate its
workforce.There are a variety of possible options for motivating employees. All the motivational
techniques will not be suitable for all the employees. Each individual will have a different need
and want. So the motivational technique varies for every person.Motivation is a very
complicated process which can be approached from different angles. The possible options of
making job more interesting are based on job design techniques. By job enlargement a number
and variety of task could be increased and a job itself might be seen as more interesting. Job
enrichment seems to be also a good way of motivating employees. The main objective of this
paper is to studyabout the motivational factors at workplace of Amazon. The results of the
research conducted reveals that all the employees feel motivated by the techniques used by
Amazon. This has significantly helped to improve their efficiency and complete the tasks.

14
 Bibliography

Books

 BiswajeetPattanayak, Human Resource Management, 4th Ed. 2014 PHI Learning Private
Limited
 K.Aswathappa, Human Resource Management, 17th Ed. 2015 McGraw Hill Education
Private limited
 P.Jyothi, D.N.Venkatesh, Human Resource Management, 2nd Ed. 2012 Oxford University
Press

Journals
 Kabst, Rüdiger, and Wenzel Matiaske. “Editorial: Human Resource Management and
Economic Success.” Management Revue, Vol. 16, no. 2, 2005, pp. 161–163.
From this article it is understood that the organisations need to focus attention on
developing a motivational climate. By way of adopting more people sensitive human
resource practices, the organization can enhance employee satisfaction and motivation.
 Agarwala, Tanuja. “Human Resource Management: The Emerging Trends.” Indian
Journal of Industrial Relations, Vol. 37, no. 3, 2002, pp. 315–331.
From this article it is understood that employee satisfaction increases as a result of
particular leadership styles, improved motivation due to different compensation packages
or work tasks, decreased employee turnover because of enhanced selection procedure.
 Dr. Ramesh Kumar, Dinesh Kumar, “Role of Motivation in Human Resource
Management at Workplace” International Journal of New Innovations in Engineering and
Technology, Vol. 2, no. 1, June 2013
From this article it is understood thatmanaging human resources plays a vital role in a
process of increasing the effectiveness of the company. Motivation is the most important
function of human resource management. The significance of motivating people at work
is recognized at all levels in the organization.

15