If a product team has a new product idea, they should start by drafting a one-page document. This paper is formatted like a press release. It imagines that the product has already been created and extols the benefits that the product will bring to Amazon's customers. The product team also creates a frequently asked questions document, or FAQ, in addition to the press release. The FAQ is a five-page document that answers queries from customers and internal personnel.

The Press Release And FAQ Method

When multiple interviewers conduct interviews with the same candidate, this can happen. After the first interviewer has finished, she may speak with the other interviewers informally about whether they liked or disliked the candidate. This may appear innocuous, but it establishes expectations in the minds of the other interviewers about how good the candidate is.Instead of fairly evaluating the candidate, they will hunt for evidence that confirms their ideas when conducting their own interviews.

Confirmation Bias During Hiring

Amazon has a unique weapon in their recruitment process that avoids urgency bias: the bar raiser. A bar raiser is a highly experienced interviewer who is not a member of the hiring team and has no vested interest in ensuring that someone is hired swiftly. The bar raiser is in charge of conducting final interviews with candidates and, more importantly, has the authority to veto individuals who aren't a suitable fit.This guarantees that teams apply a high level of discipline to their hiring procedures. They know, after all, that the bar raiser will only allow the greatest to join them.

Countering Hurried Hiring: The Bar Raiser

Despite Amazon's assurances that their books would be delivered via first-class mail, each book was delivered by priority mail. The corporation paid a higher price for this, but buyers were happy when their books arrived considerably sooner than expected. Every decision Amazon takes today is still driven by an obsession with customer experience.

Spending More To Delight The Customer

In 2004, Amazon's senior managers took turns stepping up and giving a weekly presentation on a significant topic. However, these presentations were frequently ineffective. The CEO then took a decision.Now, no PowerPoint presentations are ever used. Also, every meeting begins with silence for the first twenty minutes. The secret to Amazon's effective decision-making is silence.

No PPTs And Ample Reading Time In Meetings

In 2005, Bezos created Amazon Prime, a subscription-based membership club which offered free two-day shipping and a reduced alternative for next-day delivery. Amazon registers $25.21 billion in annual revenue from retail subscription fees from its over 200 million members, making it a massively successful idea.

Amazon Prime: The Result Of Customer Obsession

Amazonians ditched PowerPoint in favour of a six-page document in 2004. Meeting attendees now read this message for twenty minutes during each meeting. The six-pager follows a narrative format to explain the subject. This enables the topic to be discussed in greater depth and complexity, rather than just bullet points.A six-page memo, in fact, contains roughly nine times the amount of information as the slideshows it replaces. This also allows for considerably greater exploration of links between various ideas.

The Six Page Memo

The six-page document also attempts to equalize the playing field among employees. Meeting attendees would invariably rate new suggestions based in part on the presenter's speaking and graphic-design skills when PowerPoint was used to explain them. Regardless of how strong their ideas were, skilled speakers with compelling graphics tended to garner more positive answers.The six-page letter, on the other hand, kept attendees' attention on the ideas rather than the presenter, removing bias from the feedback process.

Removing Bias Of The Presentation Style

What does it mean to work backwards? It means prioritizing the client at Amazon. When Amazonians come up with new product ideas, they don't start with Amazon's needs and capabilities in mind. Instead, they exclusively evaluate what will improve the lives of their clients.They work backwards to make the customer-centric product a reality once they've found an answer.

Working Backwards

Amazon's leadership values are the bedrock of its success.Amazon's Invent and Simplify concept was exhibited by Bezos' imaginative thinking. Amazon executives are constantly looking for fresh and imaginative ways to accomplish their goals.Bezos displayed another principle by quitting his job: a Bias for Action. Amazon executives believe that speed is critical to their company's success. Even if you act fast and make a mistake, you can generally recover. It's better to take a calculated risk like Bezos did when he quit the hedge fund, rather than spending a lot of time evaluating your choices.

The Success of Amazon Is Built on Its Leadership Ideals

Many consumers still didn't find online purchasing convenient in the mid-2000s. Most things still took several days to arrive, which meant that consumers who wanted something quickly, such as a last-minute gift, preferred to shop at a physical store. Shipping charges, which were quite high in the early days of e-commerce, also turned off many customers. Customers were more likely to buy from Amazon when the company offered free shipping rather than discounts on the products themselves.By working backwards, Amazon is able to work with the foundation of its first principle: Customer Obsession.

Customers Love Free Shipping

Amazon avoids confirmation bias by requiring all interviewers to write full reports on candidates immediately following their interviews and before speaking with coworkers. The interviewers consult these reports when they meet to discuss the candidate. This system ensures that each person's opinion is their own.

Avoiding Confirmation Bias: The Amazon Way

Amazon's executives realize that tiny dreams only lead to small accomplishments. The Amazon team sees a bright, daring future, and it is this vision that has led to such remarkable success.The company's earliest offices were in a small basement in Seattle when Bezos launched his online bookstore. They used old doors attached to four-by-fours as workstations instead of proper desks. This represented the Frugality ethic, which still exists at Amazon. There are no incentives for increasing headcounts or expenditures, so leaders are praised for getting more done with less.

Thinking Big and Executing With Frugality

Urgency bias occurs when a team feels compelled to fill a vacant position, maybe because they are responsible for the work of the absent worker. Because they're so eager to find someone, they overemphasize a candidate's qualities and ignore his weaknesses. In many circumstances, this means they hire someone who isn't the best fit for the job.

Urgency Bias

<ul><li>The success of Amazon is built on its leadership ideals.</li><li>Amazon has eliminated confirmation bias and hurry from its hiring process.</li><li>When it comes to delivering complex material, PowerPoint presentations fall short.</li><li>Amazon distinguishes itself by prioritizing the needs of its consumers over their own.</li><li>Amazon’s next-day delivery option is the result of obsessive consumer focus.</li><li>The company’s leadership ideas were ignored in Amazon’s initial video-on-demand program.</li></ul>

The Ideals Of Business At Amazon

Rather than prioritizing the consumer experience, product teams look for inspiration closer to home. They may begin by appraising the skills of their research and development teams, or by being limited to the company's cost and profit margin choices.After they've created a new product that fulfils the company's needs, they hand it over to their sales and marketing department, which considers how to persuade customers to buy it. This forward-thinking mentality frequently results in organizations holding things that they desire but their customers don't.

How Normal Companies Usually Work

Jeff Bezos worked for a New York hedge fund in 1994. That year, Bezos learnt that the internet's user base was expected to rise by over two thousand per cent per year in the future years. Soon after, he made a bold decision that would come to define Amazon's philosophy: he quit his hedge fund position and set out to build Amazon.Books, Bezos thought, were the ideal product for an e-commerce firm. Even the largest bookstores could only stock tens of thousands of volumes at a time. Bezos would be able to provide practically every book that was available if he opened an online bookstore.

Amazon: The Beginning

Consider yourself a senior executive tasked with purchasing a multimillion-dollar plant to produce your company's goods. Because the decision you make will have a long-term impact on the company's bottom line, you would go through a thorough procedure to ensure that you select the proper manufacturer.Many firms, on the other hand, have little rigour in their recruitment processes when it comes to hiring the proper personnel. This is a major issue. After all, your recruiting decisions have a long-term impact on your company. That's why Amazon's hiring judgments are so accurate.

Hiring Is A Mission-Critical Decision

Essential reads for entrepreneurial growth, curated by Lenny Rachitsky.

strategy

Strategy

books

Books

startup

Startups

entrepreneurship

Entrepreneurship

business

Business

leadershipandmanagement

Leadership & Management

productivity

Productivity

timemanagement

Time Management

Lenny’s Top Business Books

 A few great ideas and innovations from Amazon.

Working Backwards is an insider's breakdown of Amazon's approach to culture, leadership, and best practices from two long-time Amazon executives. Colin started at Amazon in 1998; Bill joined in 1999. In Working Backwards, these two long-serving Amazon executives reveal and codify the principles and practices that drive the success of one of the most extraordinary companies the world has ever known. With twenty-seven years of Amazon experience between them, much of it in the early aughts—a period of unmatched innovation that brought products and services including Kindle, Amazon Prime, Amazon Studios, and Amazon Web Services to life—Bryar and Carr offer unprecedented access to the Amazon way as it was refined, articulated, and proven to be repeatable, scalable, and adaptable. With keen analysis and practical steps for applying it at your own company—no matter the size—the authors illuminate how Amazon’s fourteen leadership principles inform decision-making at all levels and reveal how the company’s culture has been defined by four characteristics: customer obsession, long-term thinking, eagerness to invent, and operational excellence. Bryar and Carr explain the set of ground-level practices that ensure these are translated into action and flow through all aspects of the business. Working Backwards is a practical guidebook and a corporate narrative, filled with the authors’ in-the-room recollections of what “Being Amazonian” is like and how it has affected their personal and professional lives. They demonstrate that success on Amazon’s scale is not achieved by the genius of any single leader, but rather through commitment to and execution of a set of well-defined, rigorously-executed principles and practices—shared here for the very first time.

personaldevelopment

Personal Development

corporateculture

Corporate Culture

Working Backwards is an insider's breakdown of Amazon's approach to culture, leadership, and best practices from two long-time Amazon executives—with lessons and techniques you can apply to your own company, and career, right now. In Working Backwards, two long-serving Amazon executives reveal the principles and practices that have driven the success of one of the most extraordinary companies the world has ever known. With twenty-seven years of Amazon experience between them—much of it during the period of unmatched innovation that created products and services including Kindle, Amazon Prime, Amazon Studios, and Amazon Web Services—Bryar and Carr offer unprecedented access to the Amazon way as it was developed and proven to be repeatable, scalable, and adaptable. With keen analysis and practical steps for applying it at your own company—no matter the size—the authors illuminate how Amazon’s fourteen leadership principles inform decision-making at all levels of the company. With a focus on customer obsession, long-term thinking, eagerness to invent, and operational excellence, Amazon’s ground-level practices ensure these characteristics are translated into action and flow through all aspects of the business. Working Backwards is both a practical guidebook and the story of how the company grew to become so successful. It is filled with the authors’ in-the-room recollections of what “Being Amazonian” is like and how their time at the company affected their personal and professional lives. They demonstrate that success on Amazon’s scale is not achieved by the genius of any single leader, but rather through commitment to and execution of a set of well-defined, rigorously-executed principles and practices—shared here for the very first time. Whatever your talent, career or organization might be, find out how you can put Working Backwards to work for you.

Colin Bryar joined Amazon in 1998 - four years after its founding - and spent the next twelve years as part of Amazon's senior leadership team as Amazon grew from a domestic (US-only) seller of books to a global, multi-dimensional powerhouse and innovator. For two of his years at Amazon, Colin was Chief of Staff to Jeff Bezos, AKA 'Jeff's shadow', during which he spent each day attending meetings, travelling with, and discussing business and life with Jeff. After Amazon, he and his family relocated to Singapore for two years where Colin served as Chief Operating Officer of e-commerce company RedMart, which was subsequently sold to Alibaba. Colin is co-founder of Working Backwards LLC where he coaches executives at both large and early stage companies on how to implement the management practices developed at Amazon.

Colin Bryar

Bill Carr is an accomplished writer whose work has resonated with readers around the world. Bill Carr has published several books that explore a range of topics, from fiction to nonfiction, and has received critical acclaim for the ability to weave compelling narratives. Bill Carr's writing style is known for its depth and authenticity, and has earned quite a loyal following of readers.

Customers Love Free Shipping

Similar ideas to Customers Love Free Shipping

Free Shipping: Shopper Psychology