What Would Jeff Bezos Do? Unlocking the Secrets to Amazon’s Success.

“Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf. No customer ever asked Amazon to create the Prime membership program, but it sure turns out they wanted it.” Jeff Bezos, Founder and CEO, Amazon

As an innovation and growth consultant I am often around CEOs and executives looking for simple answers to complex problems. In my interactions with them I’m frequently asked the same question: “What Would Jeff Bezos (or Amazon) Do in My Situation?”

I love the question. I sincerely enjoy studying Amazon and relaying how Bezos has revolutionized retail, logistics, and marketing. The topic never gets old because Amazon is always evolving. From product expansion to culture and instrumentation — so much can be learned from understanding the mechanisms that drive Amazon to the upper echelons of corporate success.

This is why I’m excited to devote the time it takes to answer the question as completely as possible, providing you with actionable insights than can change your business and help you build, not react to, the future.

In this article I will explain how Amazon got to where it is, and why consumer-centricity, long-term view, “Day 1” attitude, two-pizza team structure, Weekly Business Review (WBR) and six-page narrative decision-making tools should be employed by all companies.

The Amazon Doctrine

In 1997, Jeff Bezos boldly laid out the fundamentals of his approach for Amazon in his letter to shareholders. This was around the time of Amazon’s IPO, and according to CNBC, Bezos had generated less than $16 million in revenue.

As Bezos said, 1997 was early days for the internet, and the competition was heating up. Despite the disappointing revenue numbers, Bezos was focused on the future. He understood the power of the internet and had developed a plan with which to unlock e-commerce’s potential; specifically, by personalizing the user experience and creating real value for customers.

In what was to become Amazon’s enduring style, it took the company’s lawyers and bankers just 12 days to draft and file the S-1 prospectus for the IPO, a process that typically lasts around six weeks. David McShea, a partner at Perkins Coie and quoted by CNBC, noted the influence of Bezos during the run-up to the IPO, “Even at the time, they were intent on moving very quickly…You could feel the energy, excitement, and intensity. That was part of the culture.”

On March 15, 1997, Amazon made its debut as a public company, labeling itself as “Earth’s biggest bookstore.” Its biggest rival at the time, Barnes & Noble, filed a lawsuit taking issue with Amazon calling itself a “bookstore.” Over 20 years later, Barnes & Noble has market cap of $436.64 million — while Amazon has a market cap of $892 billion. Bookstore or not, consistent strategy and foresight have carried Amazon to the heights of corporate success since its inception.

Bezos’ 1997 letter to shareholders, presented below, reveals the CEO’s no-nonsense approach. It shows a ruthless customer agenda that has since been imbued into the organization’s psyche. As if to reiterate Bezos’ obsession with organizational order and rules, the letter has been included in every annual report since, grounding the company’s culture and providing context as they continue to journey into new sectors.

Source: Ted S. Warren/AP Images via Business Insider, 2018

If you take nothing else from this excerpt, simply note that Bezos is basically telling Wall Street to, politely, f**k off if they think he is going to pander to their quarterly needs. For Bezos and Amazon it is customer first from Day 1 — even as a public company.

“We believe that a fundamental measure of our success will be the shareholder value we create over the long term. This value will be a direct result of our ability to extend and solidify our current market leadership position. The stronger our market leadership, the more powerful our economic model. Market leadership can translate directly to higher revenue, higher profitability, greater capital velocity, and correspondingly stronger returns on invested capital.
Our decisions have consistently reflected this focus. We first measure ourselves in terms of the metrics most indicative of our market leadership: customer and revenue growth, the degree to which our customers continue to purchase from us on a repeat basis, and the strength of our brand. We have invested and will continue to invest aggressively to expand and leverage our customer base, brand, and infrastructure as we move to establish an enduring franchise.
Because of our emphasis on the long term, we may make decisions and weigh tradeoffs differently than some companies. Accordingly, we want to share with you our fundamental management and decision-making approach so that you, our shareholders, may confirm that it is consistent with your investment philosophy:
We will continue to focus relentlessly on our customers.
We will continue to make investment decisions in light of long-term market leadership considerations rather than short-term profitability considerations or short-term Wall Street reactions.
We will continue to measure our programs and the effectiveness of our investments analytically, to jettison those that do not provide acceptable returns, and to step up our investment in those that work best. We will continue to learn from both our successes and our failures.
We will make bold rather than timid investment decisions where we see a sufficient probability of gaining market leadership advantages. Some of these investments will pay off, others will not, and we will have learned another valuable lesson in either case.
When forced to choose between optimizing the appearance of our GAAP accounting and maximizing the present value of future cash flows, we’ll take the cash flows.
We will share our strategic thought processes with you when we make bold choices (to the extent competitive pressures allow), so that you may evaluate for yourselves whether we are making rational long-term leadership investments.
We will work hard to spend wisely and maintain our lean culture. We understand the importance of continually reinforcing a cost-conscious culture, particularly in a business incurring net losses.
We will balance our focus on growth with emphasis on long-term profitability and capital management. At this stage, we choose to prioritize growth because we believe that scale is central to achieving the potential of our business model.
We will continue to focus on hiring and retaining versatile and talented employees and continue to weight their compensation to stock options rather than cash. We know our success will be largely affected by our ability to attract and retain a motivated employee base, each of whom must think like, and therefore must actually be, an owner.
We aren’t so bold as to claim that the above is the “right” investment philosophy, but it’s ours, and we would be remiss if we weren’t clear in the approach we have taken and will continue to take. Jeffrey P. Bezos, Founder and Chief Executive Officer, Amazon.com, Inc.”
Source: Amazon.com, 1997

Bezos followed his inclination towards a “customer focus,” and it has become the mantra for all high-performing organizations wanting to emulate Amazon’s success. As of August 6, 2018 Amazon’s stock is valued at $1,829.55 per share up over 1000 percent since its IPO — and that’s after 3 stock splits, including a 3-for-1. In comparison , the S&P 500 is up 237.9 percent over the same period, according to data from YCharts.

Amazon’s Change Management — Knee Jerk or Insightful?

Despite setting the example, few organizations embody customer-centricity to the extent of Amazon. Zachary First, Executive Director of the Drucker Institute, thinks it is because corporations change too much too often providing little consistency for the consumer and hindering them rather than helping them.

First wrote an article for the Harvard Business Review called “Rethinking the Corporate Love Affair with Change.” In the article, he contrasts the way that corporations institute change with the way that Amazon institutes change.

Corporations tend to behave rather like a dog chasing its tail — with obsessive, pointless, circuitous activity in an endless pursuit of its goal. Amazon, on the other hand, acts more like an eagle — it sits at an elevated vantage point and surveys the landscape. It waits, identifies its prey, and considers the most efficient path to its reward, then dive bombs the unsuspecting prey with a voracity that is unparalleled in modern business.

Alan George Lafley, former CEO of Procter and Gamble, and Roger L. Martin, former Dean of the Rotman School of Management at the University of Toronto, coined the term cumulative advantage to describe the strategic benefit of not changing. “Holding on to customers is not a matter of continually adapting to changing needs in order to remain the rational or emotional best fit, it’s about helping customers avoid having to make yet another choice” Lafley said.

That said, Amazon is not immune to knee-jerk change. Lafley and Martin go on to contradict the idea that Amazon resists change by saying: “contrast Amazon’s unflinching commitment to its Weekly Business Review (how the company staffs the process for coordinating its sprawling operations) with the idiosyncratic way in which unsolicited emails from individual customers can trigger major internal restructuring..”

It’s not so much that Amazon is not changing; it is, constantly and rapidly. But rather than overreact at the slightest signal, Amazon has measures in place that ensure the changes it makes are the right ones, and those measures are combined with Amazon’s relentless ability to execute and build the future.

Predicting, and Creating, the Future

In my opinion, based on my experiences innovating in companies large and small, Amazon stands apart in its ability to deliver differentiated, unique, and best-in-class experiences to customers. It does this by honing one particular skill: anticipating customers’ needs and eliminating decisions before the customer knows they need to make them. In doing so Amazon eliminates the customer’s need to make another choice, as Lafley and Gamble identified.

Moreover, underlying this innate ability to predict the future is a distinct capability to make the future. Greg Greeley, when he departed Amazon to become the president of homes at Airbnb, stated, “Amazon, a company where builders can build, a company where you have a unique opportunity to work hard, have fun, and make history.”

Bezos’ focus is not on his competitors because the actions of his rivals depend on what Amazon does to change the future. Amazon is inventing the future for customers, not reacting to competitors. Amazon does not take technology and look for a customer problem to fix (as so many startups and Luddite companies do). Rather, Amazon creates something totally new and makes sure it eliminates a consumer’s need to choose.

This investment is very costly, and for decades Amazon has feverishly reinvested profits directly back into the customer — just take a look at the graph of Amazon’s revenue and net income below. . This gives them the ability to build markets, built on Bezos’ hard-fought, hard-won permission from Wall Street to invest in the long term. That fight began in 1997 in his letter to shareholders, and it began with the unique culture and values that Bezos was instilling in his organization. Since then, Wall Street has justly rewarded Amazon with price to earnings multiples higher than any company in history.

Source: Benedict Evans, 2014

The Amazonian Culture — Where it All Begins

Quite simply, Amazon has an unbelievably unique company culture and operating paradigm. It’s cliché, but those who have built businesses know that teams and culture have more to do with determining a business’ potential, performance, and viability than the business or product concept themselves.

Bezos has instilled a culture that is consumer-centric, and he has done so with unflinching determination and fearless leadership. In addition, Bezos is unrelenting in his commitment to the long term, which by his own admission often means risk because the company is often misunderstood for long periods of time.

Luckily for Bezos, his strategy worked and has cemented his lauded reputation as a strong and successful leader, supported by thousands of the best talent in technology committed to his strategy and approach.

Strong leadership sets the tone for an organization, and values and behaviors filter down. Every employee that joins Amazon cannot help but be indoctrinated by Amazon’s “Leadership Principles,” which it proudly lists on its jobs page. The principles:

  1. Customer Obsession: Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers.
  2. Ownership: Leaders are owners. They think long term and don’t sacrifice long-term value for short-term results. They act on behalf of the entire company, beyond just their own team. They never say, “that’s not my job.”
  3. Invent and Simplify: Leaders expect and require innovation and invention from their teams and always find ways to simplify. They are externally aware, look for new ideas from everywhere, and are not limited by “not invented here.” As we do new things, we accept that we may be misunderstood for long periods of time.
  4. Leaders Are Right, A Lot: They have strong judgment and good instincts. They seek diverse perspectives and work to disconfirm their beliefs.
  5. Learn and Be Curious: Leaders are never done learning and always seek to improve themselves. They are curious about new possibilities and act to explore them.
  6. Hire and Develop the Best: Leaders raise the performance bar with every hire and promotion. They recognize exceptional talent and willingly move them throughout the organization. Leaders develop leaders and take seriously their role in coaching others. We work on behalf of our people to invent mechanisms for development like Career Choice.
  7. Insist on the Highest Standards: Leaders have relentlessly high standards — many people may think these standards are unreasonably high. Leaders are continually raising the bar and drive their teams to deliver high-quality products, services, and processes. Leaders ensure that defects do not get sent down the line and that problems are fixed so they stay fixed.
  8. Think Big: Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold direction that inspires results. They think differently and look around corners for ways to serve customers.
  9. Bias for Action: Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk taking.
  10. Frugality: Accomplish more with less. Constraints breed resourcefulness, self-sufficiency and invention. There are no extra points for growing headcount, budget size or fixed expense.
  11. Earn Trust: Leaders listen attentively, speak candidly, and treat others respectfully. They are vocally self-critical, even when doing so is awkward or embarrassing. Leaders do not believe their or their team’s body odor smells of perfume. They benchmark themselves and their teams against the best.
  12. Dive Deep: Leaders operate at all levels, stay connected to the details, audit frequently, and are skeptical when metrics and anecdote differ. No task is beneath them.
  13. Have Backbone; Disagree and Commit: Leaders are obligated to respectfully challenge decisions when they disagree, even when doing so is uncomfortable or exhausting. Leaders have conviction and are tenacious. They do not compromise for the sake of social cohesion. Once a decision is determined, they commit wholly.
  14. Deliver Results: Leaders focus on the key inputs for their business and deliver them with the right quality and in a timely fashion. Despite setbacks, they rise to the occasion and never settle.

Source: AmazonJobs, 2018

One of the best examples of this ability to perform is immortalized in an infamous rant by Steve Yegge. Yegge spent 6.5 years at Amazon and served a similar stint at Google. In his literary masterpiece, Yegge suggests that Google does nearly everything better than Amazon, yet Amazon has been more successful when it comes to Wall Street. How so?

Yegge’s point is that Amazon figured out early that it needed to be a platform, defined by author and Platform expert, Sangeet Paul Choudary, as “a plug-and-play infrastructure that enables producers and consumers of value to connect and interact with each other in a manner that wasn’t possible in the past.” (For more information on platforms, check out the 11 platform book summaries on my website.) Amazon, Facebook, and Microsoft have all arrived at the same conclusion while Google’s culture has hindered their adoption of this reality.

Unfortunately for Google, web services is now a rapidly-growing, multi-billion dollar industry and Amazon Web Services (AWS) is a stellar platform with moats that solidify its dominance well into the future. . Yegge explains that the platform was based on a strict mandate from Bezos that dictated how teams were to manage data and service interfaces, how they were to communicate through these interfaces, and that interfaces should be designed from the ground up to be externalizable or exposable to the outside world.

Yegge both admires Amazon for establishing itself as a platform, but he also seems bemused by its success considering its failings in other areas, particularly, micromanagement by Bezos.

Yegge’s rant aside, through AWS, Bezos and the current CEO of AWS, Andrew Jassy, launched a new economy as a result of digital architecture. The power of platforms is derived from network effects for product expansion, the ease of implementing test and learn paradigms such as Lean, Kaisen, and Six Sigma, and the creation of agile development environments, all of which Amazon aced. Not to mention, Amazon was 2 years ahead of the next competition in building a web services platform.

These components are increasingly relevant because they allow the company to be more responsive to customers and the political, economic and competitive environment. Continuous improvement paradigms — Kaizen, Lean, and Six-Sigma — are embedded in everything Amazon does.

I received my Six-Sigma Green Belt from Amazon almost a decade ago and still apply the tools and discipline every day. The Amazon training manual for Six Sigma was Six Sigma for Dummies; if you have time, I highly recommend it.

The Two-pizza Teams (2PTs)

Amazon revived the quaint, and some would insist outdated, idea of divisional organization. While other companies are operating cross-functionally, Amazon has compressed management hierarchy reducing it to small teams with first-level managers. The two-pizza team process, or 2PT, is brilliantly explained by Jason Crawford, co-Founder and CEO of Fieldbook, and who is also an ex-Amazonian.

According to Crawford, most people miss the point about Amazon’s two-pizza teams. The compressed team model is so-called because the teams are so small, six to 10 people, they can be satiated with just two pizzas. Thus, many assume that the concept is about team size when it’s really about autonomy and accountability.

For context, Ben Thompson, founder of Stratechery.com and expert on the strategy and business side of technology and media, explains the difference between divisional and functional organizations.

According to Thompson, in a divisional organization, each product is effectively a company unto itself with its own marketing, engineering, and financing. The legal and HR factors are probably centralized but, other than that, the product is a stand-alone entity with the associated expenses and, most importantly, its profit-and-loss statement (P&L).

Therefore, each product’s performance is visible to everyone from the CEO to Wall Street, and the accountability for that product lies with the management associated with that product and tied to P&L. Add staff motivation to that accountability, which has a significant role to play in product performance.

Functional organizations are the exact opposite. Functions are siloed, and the products crisscross the functions so that there is ownership (read accountability) for a product’s P&L. Instead, everything accrues to the company’s overall P&L, including compensation, and the managers are left to sort out the mess — or not.

Divisional organization was the norm for multi-product companies, including Microsoft at the time, but Amazon took the model and made it into actual fiefdoms ruthlessly ruled by key performance indicators (KPIs). In fact, 2PT’s saving grace is its “fitness function.”That is, a key business metric that the senior executive team and the team leader agree will be the basis for accountability; the equivalent of the P&L for a traditional division. For example, a typical metric in the case of an Amazon fulfillment center software might be one associated with picking, packing, or sorting efficiency.

In the case of Amazon’s 2PTs, teams are given relative autonomy to pursue creative strategies with their staff of a few engineers, one or two technical product managers, and perhaps a designer who reports to the 2PT leader. There is no cross-divisional or cross-team coordination, which minimizes distractions.

The model is also attractive to potential young leaders with drive and ownership, both core Amazon values. A 2PT leadership role is all-encompassing in terms of managing a project’s different facets, yet the team and the job is small enough in scope to be manageable.

Thompson emphasizes that while the 2PT model was perfect for Amazon, it is not ideal for every firm. Apple, for example, follows a functional model, which works.

Thompson’s opinion is that companies must find a model that works for them and revisit that model over time. Thompson also states that while fitness functions are no longer used at Amazon, the sentiments of autonomy and ownership remain part of the core culture.

At Amazon, It’s Always Day 1

According to Bezos, it’s always Day 1 at Amazon. Bezos explains in a video what he means by Day 1 using the example of Amazon’s acquisition of Zappos, the online shoe and clothing e-commerce retailer.

Source: https://www.youtube.com/watch?v=-hxX_Q5CnaA

Amazon acquired Zappos for $1.2 billion in 2009 largely because he had long admired the leadership and culture at Zappos. His promise is that there is much more to come from Zappos for the consumer. In terms of future product offerings and innovations, the Amazon and Zappos venture is just the beginning, or Day 1.

Zappos and Amazon share four core values, which is why Bezos was so attracted to the company. Both companies obsess over customers rather than competitors. Both companies attempt to invent new ways of doing things, both companies have a unique culture, and both think long term.

Bezos states that commitment to the long term is costly. More importantly, it can take eight years before there is a notable return on a new strategy and, in the meantime, the company risks being misunderstood and criticized in the early days before that return is recognized.

If Day 1 is just the beginning of a long period with little return, what does Day 2 look like?

Day 2

In a 2017 all-hands meeting, Bezos was asked, “Jeff, What Does Day 2 look Like?” His answer was, “Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1.”

According to Bezos, staying in Day 1 allows a company to experiment and to fail, “to plant seeds, protect saplings, and double down when you see customer delight.” A company might function in day 2 for a long time, decades perhaps but, inevitably, death will occur.

But Bezos has this figured out too. He says that the dawn of day 2 can be staved off by four strategies: inventing on the customer’s behalf, nixing proxies, responding to external trends, and speeding up decision making.

The Danger of Proxies

To manage growth and increasing complexity, there is a tendency by companies to rely on established processes and protocols; if the right process is followed, the outcome should be satisfactory. Thus, the process is the proxy. Bezos cites market research and customer surveys as examples of tools that can serve as proxies for customers, but the results can be misinterpreted and misleading.

Bezos says, “Good inventors and designers deeply understand their customer. They spend tremendous energy developing that intuition. They study and understand many anecdotes rather than only the averages you’ll find on surveys. They live with the design.”

Bezos does not say to ditch surveys, beta testing, or other proxies, only that “a remarkable customer experience starts with heart, intuition, curiosity, play, guts, taste. You won’t find any of it in a survey.”

Knowing and Leveraging External Trends

Trends are not difficult to spot, says Bezos. The current advancements in machine learning and artificial intelligence are cases in point. Amazon has been experimenting in these areas for a long time now, not just with its high-visibility initiatives such as Prime Air delivery drones, Amazon Go convenience stores, and Alexa, but also in its back-end operations.

Amazon has incorporated machine learning into its demand forecasting, product search ranking, product and deals recommendations, merchandising placements, fraud detection, and translations.

Amazon is also sharing the capabilities to acquire this knowledge; probably because it is so far ahead it can afford to. With AWS, “organizations of all sizes can take advantage of these advanced techniques,” said Bezos, who promises many more technological gems in areas such as natural language understanding, speech generation, and image analysis, all of which will be accessed with simple APIs. “Watch this space,” says Bezos, “Much more to come.” I don’t doubt it.

Rapid Decision Making

Bezos emphasizes the need for speed and quality in decision making, something that becomes difficult for larger organizations. Bezos suggests that to stay in Day 1, “decisions should probably be made with somewhere around 70 percent of the information you wish you had. If you wait for 90 percent of the information, in most cases, you’re probably being slow.” Bezos also thinks that being slow could be costlier than being wrong, particularly if a company can easily correct a bad decision.

Bezos recommends a strategy of “disagree and commit.” Consensus may be near to impossible for a specific decision, but an agreement among leaders to take a risk and to commit to a project, although there may be discord, can save the time required to convince a minority of a potential breakthrough.

That said, Bezos states that a company should not rush so much that it fails to recognize misalignment issues. They need to be corrected immediately. For example, teams may be misaligned with conflicting objectives and perspectives, and no amount of discussion will resolve the problem.

According to Bezos, “Without escalation, the default dispute resolution mechanism for this scenario is exhaustion. Whoever has more stamina carries the decision.” Therefore, says Bezos, “Go for quick escalation instead — it’s better.

The Weekly Business Review

On the subject of rapid decision making, the Weekly Business Review (WBR) is an executive decision-making process made famous by Amazon and described by Alan Ho, entrepreneur and engineer writing for LinkedIn. Ho describes how to run a WBR and includes a template that he has used at Carista, a mobile app and hardware development company where he consults.

How to Run a WBR (in less than 30 minutes)

  1. The CEO/advisors review the metrics (5 minutes).
  2. The WBR owner provides an oral interpretation of data (5 minutes).
  3. The WBR owner suggests several “experiments” to the CEO based on data (10 minutes).
  4. The CEO approves, and the WBR owner executes (1 minute).

Source: Alan Ho, 2016

In the case of Carista, within 25 minutes, the CEO had made a key decision to increase ad spend threefold for two weeks in an attempt to scale business. The WBR revealed that some ad spend had increase hardware sales by 50 percent, in-app sales by 15 percent. Google AdMob and downloads, on the other hand, had no impact on sales. The fast decision was made after a review of the weekly metrics using the WBR.

Ho gives some caveats for the WBR, which include the need for weekly participation and analysis, the need to have another staff member parse the metrics other than the individual in charge of compiling them, the need for the WBR template, and that data should be easily viewable on a single spreadsheet on a mobile phone. Ho also states that weekly and monthly metrics should have different KPIs.

The WBR is an example of how seriously Amazon takes accountability. According to Samir Lakhani, ex-Product Manager at amazon, in WBR meetings, those staff who are responsible for metrics must explain why they missed their metrics, if they did, and what they are doing about it. “While this is as fun as a root canal,” says Lakhani, “it results in a team that knows their numbers well.”

Lakhani explained, “For example, when I was responsible for consumer metrics for my team, I could tell you in excruciating detail where we were growing well and where we weren’t, factors affecting growth and impact of initiatives we were taking. Nothing crystallizes your priorities better than having to stand in front of your peers and leadership and provide concrete answers to every question.”

The Six-page Narrative

The Six-page narrative is a leadership tool that Amazon uses internally. Matthew Tippett, software engineering and management expert describes the six-pager a decision-making tool, much like the WBR. The six pager is a document that is prepared in advance of what is typically an hour-long meeting culminating in a go or no-go decision.

The meeting will typically involve 15 minutes of reading followed by 30 to 45 minutes of questions and clarifications. According to Tippett, “the best possible outcome is five to 10 minutes of discussion and then, ‘Good narrative, I agree, go do it!’ A bad outcome is, ‘I now have more questions than I started with, let’s stop the meeting now and meet again in two weeks.’”

Drafting a six-page document might seem quite reasonable and doable, but the tricky part is covering all of the key criteria, such as revision, improvement, and validation, within six pages. Sometimes, being concise is difficult when there are so many questions to answer; however, the document does also include appendixes with supporting data and validation.

During the document creation process, the authors are forced to revise and reiterate the process and the document. The authors eliminate unnecessary information and polish the vital information. The reader should be able to easily absorb and process the information, and a well-structured piece will instill greater confidence in the reader and the associated project, subject, or initiative.

Brad Porter, Vice President and Distinguished Engineer, Robotics at Amazon agrees with Tippett and even describes his meetings using the six-pager at Amazon as “magical.” He compares them to meetings at previous companies where no one had the same data and probing flaws was pointless when no one was seeing the issue from the same perspective or understood the core decision criteria.

According to Porter, “Amazon absolutely runs better, makes better decisions, and scales better because of this particular innovation.” While writing a good six-page evidence-based narrative is hard work and difficult to do, Porter confirms his view that it is a good strategy. The upfront work requires hours of document review and a deep understanding of the space and subject matter, which can only be a good thing.

In Conclusion

I’ve laid out my analysis of Amazon in a rather large nutshell, but the future I am unable to predict. Instead, I hope I’ve come a bit closer to answering the original question that many CEOs ask, which is, “What would Jeff Bezos do if he were in my situation?”

What Bezos did was create a unique culture that is obsessed with the consumer, streamlining teams, making rational and fast decisions based on data, and a commitment to the long term both in terms of inventing and financing. Would he do that if he were in your shoes? Probably. But the thing is, even if he could tell us what he would do, we wouldn’t understand. And that’s because it will only make sense eight years from now.

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