Workers at Amazon are Not Feeling Motivated
While Amazon has become the undisputed giant of the e-commerce world, its growth has come at the expense of employee motivation. Poor working conditions in its fulfillment centers suggest an imminent employee morale crisis. Amazon now faces difficult decisions about balancing the needs of its workers with its mandate to deliver growth and profits to shareholders. This activity is important because it illustrates such tradeoffs, which are common in both large and small companies.
The goal of this exercise is for you to consider options that Amazon might have to address employee motivation and morale in a number of critical areas.
Read about Amazon’s working conditions and employee morale crisis. Then, using the three-step problem-solving approach, answer the questions that follow.
Across the globe at over 175 fulfillment centers, more than 125,000 workers frantically “pick, pack, and ship millions of Amazon.com customer orders to the tune of millions of items per year.”1 Amazon’s innovations, like free 2-day shipping for Prime members, dash buttons, and in-home delivery, have made the retail giant a standout in customer service. The company has consistently received award-winning customer satisfaction ratings.2 Amazon became the most valuable public company and second largest e-commerce company in the world in 2019 by being hyper-focused on customer experiences.3
But many of Amazon’s fulfillment center workers are unhappy with what they are required to do to assure these esteemed customer experiences.4 The result has been public outcry, boycotts, poor attitudes and health, and extremely high turnover rates among workers. What’s making employees so miserable inside Amazon fulfillment centers?
Working at an Amazon Fulfillment Center
Amazon designs its fulfillment center jobs for efficiency, with managers constantly monitoring and tracking employees in three primary areas. First, workers are monitored for productivity as they race to fill as many orders as possible to meet or exceed daily quotas. Those who don’t meet their quotas are written up, and excessive write-ups can lead to termination.5 A recent undercover investigation revealed that some employees are so fearful of missing their quotas that they forego taking necessary bathroom breaks and instead urinate in bottles and trash cans inside the warehouses.6 The company is so dedicated to its productivity goals that workers reportedly don’t speak to one another during their shifts, saying that managers strongly discourage any kind of camaraderie.7
Second, management monitors fulfillment center workers for security purposes. One employee described the environment as resembling a prison, noting time-consuming scans for contraband (e.g., sunglasses, phones, hoodies) and stolen items at the beginning and end of shifts.8 There’s also a custom of publicly shaming employees who steal from the company on flat-screen TVs and bulletin boards around the warehouses.9
Third, fulfillment center managers track employee attendance. Workers can be fired for excessive missed work days, or, as Amazon calls it, going into negative unpaid time off (UPT). Employees have reported being so terrified of missing work that they show up even when they are too sick or injured to work safely, in spite of the extremely physically demanding nature of the job.10
How Does Amazon Attract Fulfillment Center Workers?
How is it that news of a new Amazon fulfillment center is still seen as cause for celebration, given what has been reported about working conditions? Employment opportunities are one key explanation. The company tends to locate fulfillment centers on the outskirts of major metropolitan areas, often in regions that have yet to recover from the recent economic recession and are desperate for increased jobs.11 In other words, if Amazon opens a fulfillment center in your town, chances are your employment prospects will be better than those you’ve got right now.
Even so, many Amazon fulfillment center employees feel the compensation they receive is not commensurate with the extreme working conditions and job demands. Worker retention thus seems to be a function of a lack of viable alternatives rather than positive employee attitudes toward the company. As one worker stated, “that’s what makes people not want to quit—the pay” . . . “you can treat me any type of way, since this is the best money we can get out here . . .”12
Amazon does provide some additional incentives to increase productivity at its fulfillment centers. For example, managers often hold competitions that reward employees with “swag bucks”—tokens to spend inside the warehouse on things like t-shirts, water bottles, or cafeteria meals.13 Other rewards reportedly include small gift cards and even cookies. Said one employee, “I don’t want a cookie or a gift card. I’ll take it, but I’d rather a living wage. Or not being timed when you’re sitting on the toilet.”14 Another worker found these incentives insulting, saying that “around this time of year the managers, if their targets are met or exceeded, they get a bonus.”15
Amazon implemented a policy guaranteeing a minimum wage of $15 per hour after receiving such negative attention in the press. This resulted in raises as small as 25 cents per hour, which many viewed as “damage control.”16 For some tenured workers, the new policy meant their wages became compressed and they lost important benefits they previously received, such as stock options and bonus opportunities.17
Stacy Mitchell, co-director of the Institute for Local Self-Reliance, said “There’s this way in which Amazon’s warehouses are perceived to be a good thing for a community, but that’s only because the context in which they are being proposed and built is so devoid of better opportunities.” Said a current employee, “They’re walking a fine line in the community—everybody knows someone who’s worked there, and no one says it’s a good place to work.”18
Some Amazon workers have attempted to generate interest in union representation but have been unable to gain the momentum necessary for an organizing campaign. This is likely due to two main causes. First, the fact that Amazon has one of the highest turnover rates in the United States means that employees aren’t around long enough for a movement to take shape. Second, workers have expressed they are afraid to speak up and participate in organizing campaigns for fear of retaliation from the company.19
It’s unlikely we’ll see any sweeping changes to the way Amazon manages its fulfillment center workers in the near future. This is because Amazon already loses money on e-commerce and subsidizes the losses with other segments of its business. Any changes to the current state of affairs could mean a loss of our coveted cheap wares and free two-day shipping.20
Apply the 3-Step Problem-Solving Approach
· Step 1: Define the problem.
A. Look first at the Outcome box of the Organizing Framework in Figure 5.11 to help identify the important problem(s) in this case. Remember, a problem is a gap between a desired and current state. State your problem as a gap and be sure to consider problems at all three levels. If more than one desired outcome is not being accomplished, decide which one is most important and focus on it for steps 2 and 3.
1. Cases have protagonists (key players), and problems are generally viewed from a particular protagonist’s perspective. Identify the perspective from which you’re defining the problem—is it the perspective of Amazon or its workers?
1. Use details in the case to identify the key problem. Don’t assume, infer, or create problems that are not included in the case.
1. To refine your choice, ask yourself, why is this a problem? Explaining why helps refine and focus your thinking. Focus on topics in the current chapter, because we generally select cases that illustrate concepts in the current chapter.
1. Step 2: Identify causes of the problem by using material from this chapter, summarized in the Organizing Framework shown in Figure 5.11. Causes will appear in either the Inputs box or the Processes box.
B. Start by looking at Figure 5.11 to identify which person factors, if any, are most likely causes to the defined problem. For each cause, ask: Why is this a cause of the problem? Asking why multiple times is more likely to lead you to root causes of the problem.
2. Follow the same process for the situation factors.
2. Now consider the Processes box in Figure 5.11. Consider concepts listed at all three levels. For any concept that might be a cause, ask: Why is this a cause? Again, do this for several iterations to arrive at root causes.
2. To check the accuracy or appropriateness of the causes, be sure to map them onto the defined problem.
1. Step 3: Make recommendations for solving the problem, considering whether you want to resolve it, solve it, or dissolve it. Which recommendation is desirable and feasible?
C. Given the causes identified in Step 2, what are your best recommendations? Use the content in Chapter 5 or one of the earlier chapters to propose a solution.
3. You may find potential solutions in the OB in Action boxes and Applying OB boxes within this chapter. These features provide insights into what other individuals or companies are doing in relationship to the topic at hand.
3. Create an action plan for implementing your recommendations.
1. See “Our Fulfillment Centers,” Aboutamazon.com, https://www.aboutamazon.com/amazon-fulfillment/our-fulfillment-centers, accessed March 20, 2019; and “Amazon’s Fulfillment Network,” Aboutamazon.com, https://www.aboutamazon.com/working-at-amazon/amazons-fulfillment-network, accessed April 2, 2019.
2. See E. Feinberg, “How Amazon Is Investing In Customer Experience by Reimagining Retail Delivery,” Forbes, January 4, 2018, https://www.forbes.com/sites/forbescommunicationscouncil/2018/01/04/how-amazon-is-investing-in-customer-experience-by-reimagining-retail-delivery/#5c78fd7f2c2e; and B. Morgan, “Costco Takes Top Spot In Online Customer Satisfaction over Amazon,” Forbes, February 27, 2019, https://www.forbes.com/sites/blakemorgan/2019/02/27/costco-takes-top-spot-in-online-customer-satisfaction-over-amazon/#1290d33949a7.
3. See L. Feiner, “Amazon Is the Most Valuable Public Company in the World after Passing Microsoft,” CNBC, January 7, 2019, https://www.cnbc.com/2019/01/07/amazon-passes-microsoft-market-value-becomes-largest.html; and A. Levy, “The 7 Largest E-Commerce Companies in the World,” The Motley Fool, December 26, 2018, https://www.fool.com/investing/2018/12/26/the-7-largest-e-commerce-companies-in-the-world.aspx.
4. S. Liao, “Amazon Warehouse Workers Skip Bathroom Breaks to Keep Their Jobs, Says Report,” The Verge, April 16, 2018, https://www.theverge.com/2018/4/16/17243026/amazon-warehouse-jobs-worker-conditions-bathroom-breaks.
5. A. Semuels, “What Amazon Does to Poor Cities,” The Atlantic, February 1, 2018, https://www.theatlantic.com/business/archive/2018/02/amazon-warehouses-poor-cities/552020/.
6. N. Godlewski, “Amazon Working Conditions: Urinating in Trash Cans, Shamed to Work Injured, List of Employee Complaints,” Newsweek, September 12, 2018, https://www.newsweek.com/amazon-drivers-warehouse-conditions-workers-complains-jeff-bezos-bernie-1118849.
7. C. Lieber, “Bernie Sanders Called Out Jeff Bezos for Poor Treatment of Amazon Workers. In a Rare Move, the Company Fired Back,” Vox, August 30, 2018, https://www.vox.com/2018/8/30/17797786/amazon-warehouse-conditions-bernie-sanders.
8. S. Liao, “Amazon Warehouse Workers Skip Bathroom Breaks to Keep Their Jobs, Says Report,” The Verge, April 16, 2018, https://www.theverge.com/2018/4/16/17243026/amazon-warehouse-jobs-worker-conditions-bathroom-breaks.
9. E. Fox, “Amazon Reportedly Has Scoreboards to Shame Its Workers,” Vanity Fair, March 8, 2016, https://www.vanityfair.com/news/2016/03/amazon-warehouse-theft.
10. I. A. Hamilton and Á. Cain, “Amazon Warehouse Employees Speak Out about the ‘Brutal’ Reality of Working during the Holidays, When 60-Hour Weeks Are Mandatory and Ambulance Calls are Common,” Business Insider, February 19, 2019, https://www.businessinsider.com/amazon-employees-describe-peak-2019-2.
11. A. Semuels, “What Amazon Does to Poor Cities,” The Atlantic, February 1, 2018, https://www.theatlantic.com/business/archive/2018/02/amazon-warehouses-poor-cities/552020/.