The Amazon Way

Leadership Principles for success

Amazon.com is the biggest online everything store today. The secret ingredients to the company success are its 14 leadership principles that amazonians live and breath by. These are not suggested guidelines for its employees but infact core tenets on which leaders are judged and rated. Amazon leaders work hard to make their thinking very clear - to be clear not only about what they decide but also precisely why they decide as they do. This quest for clarity has created an organization whose actions are based on a specific philosophy and a consistent set of values and principles. It is how they get the details right and scale their business successfully.

In The Amazon Way former employee John Rossman writes about the 14 principles guiding the company. These principles were the foundation of the many strategies, management techniques and lessons he learnt and practiced at the company and kept referencing to years after he had left. I have written about some of them below

Customer Obsession: Since its inception, Amazon has raised the bar on customer service for many companies. Jeff Bezos makes it the focal point of any discussion or decision and he has been doing that long before social media revolutionized the retail world with its vast transparent networks linking companies, customers, vendors, prospects and detractors. The company works on notoriously thin margins and keeps prices low in order to invest the capital back into business so it can offer more selection which attracts more customers that generates traffic and pulls more vendors offering greater selection (completing a virtuous cycle). Price, selection and availability are the three durable and universal customer desires that amazon thinks of as its holy trinity. Offer everything, get it cheaper and make it more easily available

The history of the company is studded with innovation and triumphs driven by customer obsession - look inside the book feature and Amazon Prime to name a few. If you’re competitor-focused you have to wait until there is a competitor doing something but being customer-focused it allows you to be more pioneering.

You have two ways to grow a business: Do what you’re good at and extend out from your skills OR figure out what your customers need and work backwards, even if it requires learning new skills.

Ownership: The highest level of customer service is impossible to achieve without the highest degree of accountability and willingness to be direct, open and honest - ESPECIALLY when things are not going well. Ownership also means not only mastering your domain but also being willing to go beyond the boundaries of your role whenever its needed to improve operations or fix a problem.

Invent and simply: The best design is the simplest which makes it easier to scale and measure than complex designs. Automate processes and make workflows simpler where you can. When process innovation practiced without simplicity it creates bureaucracy

Be Right A Lot: Making mistakes is ok but making the same mistake over and over again or failing for the wrong reasons is a kiss of death.

Highest Standards: When you settle for the median in your numbers and targets thats when mediocrity settles in.

Think Big: Think about the vast potential of any project from day one and create an inspired team that owns that.

Bias for Action: Its good to be on top of your numbers but avoid paralysis from analysis and keep moving forward on things without waiting to be asked to do so. That may sound like decision-making based on gut instinct but how how do you balance that with being right a lot? By developing and monitoring the metrics.

Furgality: Less is more. always

Dive Deep: Experiments are encouraged but results must be rigorously measured. This combination of free thinking and disciplined analysis is what makes dive deep so important. Its is also driven by the fact that a company is like an ecosystem. It is complex, constantly evolving and thrives on diversity. This also means numerous opportunities for failure constantly emerging. For this reason data is power, stay close to it, question it and constantly keep poking holes in it.