Jeff Bezos is the founder of Amazon and the first person in history to have a personal net worth in excess of $200bn. He founded Amazon in 1994 and it has grown into a global giant with revenue of circa $280bn in 2020. The business has expanded into countless industries from its humble beginnings of selling books. Jeff Bezos has also founded Blue Origin and has won a contract to build space craft for NASA. So, what can we learn from Jeff Bezos’s leadership?
Put your customers first
Amazon has thrived for one simple reason; they have consistently put customers in front of profit. Its fundamental belief is that if its customers have a good experience, they will consistently come back and spend more money which is good for business. As Jeff Bezos has said:
“We’re not competitor obsessed, we’re customer obsessed. We start with the customer and we work backwards.”
Although this seems painfully obvious, very few businesses actually achieve this. It means ignoring what your competitors are doing and also making decisions that may benefit customers but are not linked to any clear financial metric. There are many businesses that only do things for customers if it makes financial sense for the business. This shows when Jeff Bezos talks about Amazons financial results, he has often said that the work he is doing today will only be shown in financial results 2 or 3 years from now. Yet many other business leaders only ever seem focused on the current quarter.
Ironically, despite its enormous success one of the things Amazon has done best is fail. Its history is littered with high profile failures, but that is actually what has led to their success. Amazon tried to move into the mobile phone market. Its Amazon Fire phone lost circa $170m and they could not even sell it when they put it up for sale for 99 cents. Amazon tried to launch its own version of Apple Pay and shut that down within 6 months and who can forget its incredibly high-profile failure with pets.com but it helps that Amazon does not punish failure. As Jeff Bezos has said:
“If you’re going to take bold bets, they’re going to be experiments, and if they’re experiments, you don’t know ahead of time if they’re going to work. Experiments are by their very nature prone to failure. But a few big successes compensate for dozens and dozens of things that didn’t work.”
Despite the high profile failures its move in to areas such as Amazon Web Services, launching Amazon Kindle, Amazon Prime, Alexa, Audible, IMDB etc have all more than compensated for the high profile failures and helped them become one of the most successful businesses in the world.
Amazon famously banned PowerPoint presentations and instead a leader must share a 6-page written memo that everyone reads and makes notes on at the beginning of every meeting. Jeff Bezos often says this is the smartest thing they ever did:
“Many, many years ago, we outlawed PowerPoint presentations at Amazon and it’s probably the smartest thing we ever did.”
This means that people are less likely to be able to blag their way through a meeting without knowing all of the content, and likewise the idea to be discussed is concise and clearly articulated. It is impossible to write a 6-page memo without the concept being well though out. Likewise, by forcing everyone to read the memo in advance it stops the person who would present the slides being asked about slide 6 while showing slide 3 and allows everyone to be focused on the whole idea as opposed to bits and pieces.
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