Chapter 9

Firms like Amazon align strategic control systems and governance structures to sustain competitive advantage. Amazon's governance model includes Jeff Bezos as CEO and Chairman and a board of external directors from various backgrounds. Amazon has a Leadership Development and Compensation Committee that oversees executive planning and job roles. For strategic control, Amazon employs a decentralized and divisional structure as it has small autonomous teams that make quick and innovative decisions. The board uses balanced scorecards, financial milestones, and special-alert systems to monitor performance and manage strategic risk. Amazon's control systems make sure that innovative technologies such as AWS are balanced with shareholder oversight.