Amazon’s leadership principles are more than just guidelines; they are a way of life within the organization. Over the years, these principles have been crafted with care, allowing the company to scale its culture and operations effectively. In this blog post, I will share how Andy Jassy, CEO of Amazon explains leadership principles. In separate posts I will explore these principles in detail, with examples from my own experience working as a PM-T within Amazon Business and Supply Chain organizations, understanding their nuances and how they shape the actions and decisions of Amazon’s leaders.
Customer Obsession
The foundation of Amazon’s business model rests on customer obsession. Leaders at Amazon start with the customer and work backward. This principle emphasizes not just understanding customer needs but actively seeking to earn and maintain their trust. For instance, during the economic uncertainty of the pandemic, while many companies attempted to maximize profits, Amazon proactively engaged with customers to identify ways to help them save money. This approach underscores the belief that true customer focus is about long-term relationships rather than short-term gains.
Amazon’s product development process reflects this principle. Before writing a single line of code for a new product, teams prepare a working backward document, which includes a press release and a frequently asked questions document. This ensures that any product launched genuinely addresses customer needs and desires.
Are Right, A Lot
Being right often equates to having sound judgment and strong instincts. At Amazon, leaders are encouraged to seek diverse perspectives and question their own beliefs. This principle is crucial in navigating the ambiguity that often accompanies innovative ventures.
One common misconception is that being right means always having the best idea. In reality, it’s about fostering an environment where the best ideas can emerge through collaboration. Leaders are encouraged to listen to input from their teams, as the goal is to arrive at the best possible solution for customers, regardless of who proposed it.
Invent and Simplify
Innovation is key to Amazon’s success. The principle of invent and simplify encourages leaders to look for new ideas from various sources and not be constrained by the notion of “not invented here.” This openness to innovation allows Amazon to reinvent its business continuously.
A notable example is Amazon’s transition to a marketplace model. Initially hesitant due to concerns about customer service from third-party sellers, Amazon ultimately embraced this model. By integrating third-party products onto the same product pages as their own, they significantly expanded their selection and improved customer satisfaction.
Think Big
Thinking big is about creating a bold vision that inspires results. Amazon leaders are encouraged to look around corners and anticipate future customer needs. This principle is evident in initiatives like the shift to faster delivery options, where Amazon has consistently pushed the boundaries of what’s possible.
For instance, the evolution of delivery services from several days to same-day delivery illustrates Amazon’s commitment to thinking big. By continuously challenging the status quo, Amazon aims to redefine customer expectations.
Dive Deep
Leaders at Amazon are expected to operate at all levels, staying connected to the details of their operations. This principle emphasizes that no task is beneath them, and it’s essential to understand the intricacies of their business. By diving deep into the details, leaders can identify potential issues that broader metrics might obscure.
Effective leaders create mechanisms for inspection and audit, ensuring that they can catch discrepancies between metrics and customer experiences. This attention to detail helps maintain high standards across the organization.
Insist on the Highest Standards
Amazon has a reputation for maintaining high standards, which can sometimes seem unreasonable. However, these standards are essential for meeting customer expectations. Leaders are tasked with continuously raising the bar and ensuring that defects are addressed promptly.
This principle reinforces the idea that high standards lead to better outcomes. By modeling what good looks like, leaders can influence their teams and help propagate a culture of excellence throughout the organization.
Bias for Action
In a fast-paced business environment, speed matters. Amazon values calculated risk-taking and encourages leaders to make decisions quickly. Most decisions at Amazon are characterized as two-way doors, meaning they can be reversed if necessary. This mindset allows teams to act swiftly without the fear of making irreversible mistakes.
However, leaders are also reminded that while speed is crucial, it should never come at the expense of quality. Balancing high standards with a bias for action is essential for delivering exceptional customer experiences.
Ownership
Ownership is a mindset that transcends individual roles at Amazon. Leaders are expected to think long-term and act on behalf of the entire company, not just their team.
This principle encourages employees to take initiative and responsibilities seriously, fostering a culture of accountability.
When individuals think like owners, they naturally seek solutions to problems rather than passing them off to someone else. This proactive approach is vital for driving the company forward.
Frugality
Frugality at Amazon is not merely about cutting costs; it’s about being resourceful. The principle emphasizes that constraints can breed innovation and efficiency. Amazon’s culture encourages teams to do more with less, which has been a fundamental aspect of its success.
For example, the development of AWS was achieved with small teams, demonstrating that focused, resourceful efforts can lead to groundbreaking innovations.
Learn and Be Curious
A commitment to continuous learning is essential for personal and professional growth. Amazon leaders are encouraged to remain curious and seek opportunities to improve. This principle promotes a culture where employees are not only open to learning but are also proactive in exploring new possibilities.
Leaders who embody this principle are often those who drive significant growth within their teams, as they actively seek to understand their environment and adapt accordingly.
Have Backbone; Disagree and Commit
At Amazon, leaders are expected to engage in respectful debate and challenge decisions when necessary. This principle encourages a culture of open communication, where differing opinions can be expressed without fear of repercussions. However, once a decision is made, everyone is expected to commit to it fully.
This balance between respectful disagreement and commitment to team decisions fosters a culture of accountability and focus, essential for driving results.
Earn Trust
Trust is fundamental to Amazon’s culture. Leaders are expected to listen attentively, speak candidly, and treat others with respect. This principle emphasizes the importance of being vocally self-critical and honest about one’s performance.
Building trust requires consistent actions that align with words, creating a reliable environment where team members feel valued and respected.
Strive to be Earth’s Best Employer
Amazon is committed to creating a safe, productive, and diverse work environment. This principle reflects the company’s focus on empathy and employee growth, ensuring that every employee feels empowered and supported.
Leaders are encouraged to actively seek feedback from their teams to improve the workplace continuously. This commitment to employee wellbeing is crucial as Amazon seeks to be a leader in workplace culture.
Success and Scale Bring Broad Responsibility
As Amazon has grown, so has its responsibility to the communities it serves. This principle emphasizes the importance of being a good corporate citizen and ensuring that the company’s actions positively impact the world. Leaders are encouraged to think about the wider effects of their decisions and strive to leave every situation better than they found it.
From community investments to sustainability efforts, Amazon’s leaders are expected to contribute positively to society while pursuing business success.
Hire and Develop the Best
Hiring exceptional talent is crucial for Amazon’s success. This principle stresses the importance of raising the performance bar with every hire and actively developing team members. Leaders are responsible for coaching and mentoring their teams, ensuring that everyone has the opportunity to reach their full potential.
By focusing on talent development, Amazon can maintain a high-performing culture that benefits both employees and customers alike.
Deliver Results
Ultimately, delivering results is what matters most. This principle focuses on the key inputs necessary for success and emphasizes the importance of timeliness and quality. Leaders are expected to rise to challenges and ensure that customer needs are met effectively.
At Amazon, delivery is not the finish line; it is merely the starting point for continuous improvement and iteration. By focusing on results, Amazon can maintain its competitive edge and continue to meet customer expectations.
Conclusion
Amazon’s leadership principles are more than just a set of guidelines; they are a way of life that shapes the company’s culture and operations. By understanding and practicing these principles, Amazon leaders can navigate the complexities of their roles and drive the organization forward. As the company continues to evolve, these principles will remain integral to its success, guiding leaders in their quest to serve customers and the broader community.