In this article, we’re going to look at some of the secrets behind Amazon’s monumental success and how you can apply these concepts to your own work to successfully integrate them into the company.
We’ll take a look at:
Let’s dive in.
On an interesting note: In the book “Working Backwards: Insights, Stories, and Secrets from Inside Amazon” executives Colin Bryar and Bill Carr state that “the elements of being Amazonian are also applicable” to achieving success in any scenario, whether business or otherwise, “regardless of scale and scope.”
So, whether you hope to be a potential employee of Amazon in the future or are just curious about the inner workings of Amazon’s corporate employee culture, this article aims to help answer how Amazon has been able to maintain its successes over these past few decades.
Amazon’s work culture is Day 1 culture and can be defined as a culture and business methodology centered around customers. The key to putting Day 1 into action is keeping a long-term perspective, focusing on the customer, and not being afraid to innovate to solve their problems and needs. Under Day 1 culture, you should be asking yourself questions such as:
So, now that you have an overview let’s look at why it’s important.
Learn more about why Amazon is the company for you.
Day 1 culture is important because it keeps the company focused, dynamic,prevents Day 2 pitfalls such as stagnation. It is a challenge to keep a growing company innovative, and Amazon understands this and values employees that can keep its original principles exhaustively in mind whilst it grows.
Jeff Bezos wrote in a 2016 shareholder letter: “Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1.”
Day 2 culture focuses on short-term thinking, which fosters a dependence on not making mistakes. This in turn can lead to less innovation, testing of ideas, and possible successful iterations.
Day 1 is all about having a positive association with failure and the lessons you can learn from it. However, short-term thinking does have its place at Amazon.
Say a specific product becomes successful, short-term thinking is organized around measurable metrics, such as margins and productivity.
As Steven Brozovich the AWS Principal Evangelist for HR put it, Amazon as a rapidly growing company needs to be able to “risk bigger and more, [and take] bigger and bolder bets… failure drives improvement, not punishment.”
However, coping with growth in a Day 2 company with increasing organizational complexity can mean slower decision making on policies and signing off on ideas. This puts the focus on internal struggles, rather than “customer-centric innovation.”
This has led to in-house solutions such as de-risking the impact test-ideas and experimentation can have on short-term impact. This also creates smaller teams and enabling them to make autonomous decisions.
Working at Amazon means working in an environment that fosters the ability to trust your intuition and taking initiative where customer feedback correlates with a customer opportunity.
Amazon has a positive relationship with failure and is not afraid to make business mistakes, since it is seen as an opportunity to take lessons learned about organization, customer satisfaction, and product design, and to use them to create better products for its customers.
To not fall into a Day 2 trap, you should be asking yourself questions such as am I okay taking initiative and making mistakes?
Am I able to turn these failures into lessons learned for future products? Steven Brozovich in Amazon’s video detailing Day 1 and Day 2 culture said, “ultimately our goal is to hire the right people, connect them tightly to the customers, and then get out of their way so they can go build.”
Amazon has 6 principle that are the basis of its tremendous success:
If you haven’t noticed yet, Amazon values employees that put the customer first and work very hard to gain the trust of their customers.
Instead of focusing on the competition aspect of business, Amazon focuses on how they can better serve the customers that make their company possible. Amazon prides itself on a culture of “working backwards.”
This means that instead of anticipating what the customer base may need in the future, Amazon takes direct feedback to drive its innovation.
Scaling the business and hiring more employees to meet the growing demand increases the need to simplify the additional complexity caused by these hires.
However, to resist a seeping in of Day 2 culture Amazon has remained committed to small “two pizza teams,” a term coined to describe a team size that can be fed by two large pizzas.
The two-pizza rule ensures autonomous decision-making that can be owned by the team from start to finish. Teams are given the resources they need to oversee their project and watch metrics. High-level. This ensures high level employee performance as it allows them to cancel the bureaucratic culture within their company.
Because we live in a rapidly shifting world, driven by great technological advances and changing laws and political landscapes, Amazon recognizes that this is not an excuse for them to stop innovating.
Nor is it a reason for them to start resting on their laurels. The needs of the customer is the most important thing to Amazon’s many employees and are always kept exhaustively in focus,
while the ever-shifting environments that Amazon operates within serve as inspiration to experiment, stay curious, and prioritize new underserved needs of its customers.
Amazon values the leaders that don’t let the growth of the company get in-between them and the customer.
“Staying in Day 1 requires you to experiment patiently, accept failures, plant seeds, protect saplings, and double down when you see customer delight.” -CEO Jeff Bezos, 2016 Shareholder Letter
One of the keys to Amazon’s success is its willingness to embrace change. The company constantly experiments with new ways to work and implements changes to its culture based on what will work best for employees.
This constant innovation ensures that employees are learning and growing their skills. With an employee-focused environment, comes the expectation of meeting deadlines, and withstanding greater responsibilities.
One of the key reasons why Amazon’s work culture is so successful is because it fosters creativity within teams.
Employees are encouraged to come up with new ideas and develop their skills in new areas. This freedom allows them to be creative and innovative in their work. This contributes to their team’s positive performance in the company.
One of the hallmarks of Amazon’s success is its ability to operate at low costs despite rapid growth. This has allowed the company to expand rapidly into new markets and build into global economies.
Amazon’s culture of innovation is constantly evolving to meet the needs of its customers. This culture of innovation has helped the company stay ahead of the curve and remain competitive.
Here are the main values of such a culture:
Here is an example of such a process in the AWS Digital Innovation Model:
Amazon has outlined 16 leading leadership principles that they largely function by:
Customer Obsession: Amazon’s customer obsession is one of the company’s most defining characteristics. This customer orientation has helped Amazon become one of the world’s leading eCommerce companies. Every aspect of the customer experience is important to the company, and it goes above and beyond to ensure that each individual customer feels valued. This factor is an integral part of the company’s growth.
Ownership: The culture of Amazon is one of ownership. The company encourages employees to take ownership of their work and be self-reliant, but also to think beyond just their role to the larger perspective. Ask yourself this question, is there more I can do in my role to foster success? Am I taking accountability for my mistakes? Am I learning from them? This philosophy has led to Amazon’s success.
Invent and Simplify: At Amazon, the culture is centered around inventing and simplifying. What does that mean for employees? It means that there is a high level of trust and accountability among team members. This fosters creativity and innovation because everyone is working towards a common goal. Even if the methods to try something new aren’t completely understood, Amazon values failure for the sake of innovation over stagnation.
Are right, a lot: Are you considering opinions and ideas outside of your own? When was the last time you adopted a successful opinion that was different from your own? As a leader, are you choosing to trust in your co-workers?
Learn and be curious: Employees are encouraged to ask questions and explore ideas, thus encouraging creativity and innovation. It also paves the way for better decision-making and understanding of complex issues. What do you not know that you would like to learn about? Are you keeping an open mind to new ideas?
Give everyone a voice: At Amazon, employees are encouraged to speak up. All opinions are valued, and everyone is encouraged to participate in discussions. This leads to better decision-making and stronger collaboration.
Insist on the highest standards: One of the secrets behind Amazon’s monumental success is its insistence on maintaining the highest standards. This doesn’t mean that employees have to be perfect, quite the opposite. However, it does mean that everyone is held accountable for their actions and results. This demanding environment motivates employees to collaborate and ensures that everyone is working towards a common goal.
Think big: Amazon places emphasis on creating a fun and stimulating work environment. They believe that this is key to keeping their employees engaged and motivated. In addition to creating a stimulating environment, Amazon also prioritized transparency and communication within its ranks. This meant that everyone within the company are constantly aware of what is happening and could offer feedback or suggestions.
Bias for action: Since its founding in 1994, Amazon has become one of the most successful companies in the world, an E commerce giant. It’s no wonder why: their culture is insanely conducive to success. They understand that to stay competitive quick business decisions are important.
“Leaders are constantly faced with uncertainty, so they must make quick and calculated judgements.”
Frugality: Amazon has been praised for its innovative business practices and frugality. To keep costs down, Amazon has instituted several cost-saving measures and each of its divisions and teams does not get an open checkbook. The opposite is true, company managers are encouraged to achieve great results in spite of budget limitations.
Earn trust: Trust is key at Amazon. From the get-go, the company fostered an environment where employees can share ideas and feedback freely. This open communication helps to create a sense of community within the company and strengthens relationships between team members. As a result, employees are motivated to put their best foot forward and can trust each other with critical information.
Dive deep: Leaders work across all departments are encouraged to stay in touch with details related to their work and products, review them frequently, and stay skeptical when they are dealing with anecdotal evidence. They are capable of handling any task.
Have a backbone; disagree and commit: At Amazon, the corporate culture is all about commitment and disagreement. Employees are expected to commit to new ideas even if they don’t agree with them. This attitude has helped Amazon stay away from stagnation, and Day 2 culture.
Deliver results: At Amazon, current and former employees learn how to move quickly and deliver results. This hyper-speed unique organizational culture has helped the company become one of the world’s leading retailers. To keep up with tight deadlines, employees often work long hours and can take on a lot of responsibility. But this relentless work ethic pays off: Amazon ranks first in Fortune’s list of the “100 Best Companies to Work For” for a third consecutive year.
Strive to be Earth’s best Employee: With an innovative work culture and cutting-edge technology, the company has become one of the most successful businesses in history. Along with this comes responsibility to foster the right environment for professional development and growth for everyone. Safety, diversity, a just work environment, and high performance are at the core of this principle.
Success and scale bring broad responsibility: This last principle refers to the responsibility and impact Amazon has on the earth in social, economic, and environmental terms. As a broad global company, Amazon must strive to have a lasting positive impact on all three of these factors.
“We started in a garage, but we’re not there anymore. We are big, we impact the world…and we are far from perfect…our local communities, planet, and future generations need us to be better every day. We must begin each day with a determination to make better, do better, and be better for our customers, our employees, our partners and the world at large. And we must end everyday knowing we can do more tomorrow. Leaders create more than they consume and always leave things better than how they found them.”
Amazon’s vision statement is: “Our vision is to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices.”
“Work hard. Have fun. Make history.” Amazon also commonly utilizes the catchphrases “From A to Z” and “Earth’s most customer-centric organization.” These idioms are employed to raise brand recognition and customer involvement.
The eCommerce giant has become synonymous with “shopping on the internet.” From household items, books, appliances, and electronics, and more, Amazon has you covered for “everything.”
According to Bloomberg, the company suffers from a cutthroat environment that doesn’t take into account the personal obligations of employees, particularly during the pandemic. Amazon’s growth is very demanding for some workers.
According to the Guardian Amazon is replacing about 3% of its warehouse workforce each week or 150% yearly.
As a result, the company is understaffed and continuously searches for new workers. Is it bad culture or outside forces(Covid-19) It’s hard to tell.
Vox thinks it’s both. According to the newspaper, the “Turnover in the US retail industry was slightly higher than that — 58 percent and nearly 70 percent respectively in 2019 and 2020 — but still only about half as bad as Amazon’s“.