Amazon and Google: A Tale of Two Cultures

Amazon and Google both made the news in the last couple of weeks. Amazon drew attention and debate for its culture, which, depending on who you talk to, is either punishing or exhilarating. Google announced a massive reorganization separating its money-making ventures from its exploratory missions. Although less obvious than the overt role of culture in the Amazon story, the Google reorganization under an umbrella company, Alphabet, is also a story that hinges on culture and talent. Google has traditionally made it onto every top companies to work for list; in no small part due to their culture. And yet, as they have grown they have found it harder and harder to attract the talent they need in order to continue innovating. In part, this is because their initiatives are so diverse that a one-size fits all culture has become a liability rather than an asset, even if that culture is viewed positively. The reorganization will allow them to develop distinctive sub-cultures which will better suit the strategic goals of their specific initiatives — and undoubtedly attract specific segments of talent.

Exploring these two contrasting companies reveals the fundamental relationship between culture, talent, and company performance. Company culture is a filter that determines what talent is attracted and retained at your company and what talent is deterred. By definition, a strong culture will cause some portion of the population to avoid working at your company either during the job search and recruiting process or after being hired. The question companies need to ask is whether their culture is fueling their strategic goals or not.

The Amazon Experience

Amazon is not the first company to be both lauded and vilified for its competitive culture. Bridgewater operates in the world of finance but espouses many of the same controversial virtues that are under scrutiny at Amazon. According to Bridgewater’s CEO, Ray Dalio, constant feedback and criticism facilitate an environment where even the lowest level associate can have an impact.

“I believe that the biggest problem that humanity faces is an ego sensitivity to finding out whether one is right or wrong and identifying what one’s strengths and weaknesses are.”

Sound familiar?

“At Amazon, workers are encouraged to tear apart one another’s ideas in meetings…”

Similarly both companies work hard to codify their culture through onboarding, employee handbooks (Bridgewater’s is a 100 page tome titled “Principles” whereas Amazon provides new hires with laminated cards with their 14 leadership principles), and daily routines. Perhaps most notably, both companies have charismatic leaders who demonstrate dogmatic dedication to their philosophies.

Not surprisingly, Amazon’s culture is extremely polarizing. The original NYTimes article garnered more than 5000 comments in just a few days, and other forums like Hacker News and Reddit hosted lengthy discussions with current and former employees weighing in. Those who speak positively of Amazon’s culture point to the caliber of employee, positive impact on one’s career trajectory, and the performance of the company as a whole (Amazon is the world’s most valuable retailer). Those who speak negatively, tell stories of grueling work schedules, frequent emotional breakdowns, and unfeeling management practices.

Cohesive strong company cultures do not work for everyone. This is true whether you are looking at a culture like Amazon or a culture like Google. And in cases like Amazon, the strength of the culture tends to go hand in hand with the level of controversy and criticism surrounding it. This is because the culture tends to result in a high level of attrition by design. There is no question that it feels terrible work in a culture that doesn’t work for you, but it doesn’t mean it’s a terrible culture period.

Breaking down the Googleplex

Google in contrast to Amazon could not be any more different in terms of culture. While Amazonians are deemed ‘Am-holes’ by Seattle locals, Google makes hires with a ‘no assholes’ rule that is one of the pillars of ‘Googliness.’ So what’s wrong with a company that gets positive reviews from employees and is perceived by the public as a work utopia packed with benefits?

In part, it’s the result of Google’s growth into large mature company — with the accompanying bureaucracy. Cultures change over time based on the goals of a company, and as Google has evolved so has their culture. This isn’t a problem for a large portion of the company, but Google wants to remain an innovator. And to do that they have to retain talent that is looking for something other than a big company with successful products and great benefits. They want to attract risk-takers, talent that moves fast, makes mistakes, and fixes them. To do this they need to allow for sub-cultures to develop that look and feel very different than the comfort of Google. These cultures will be able to more effectively compete for talent with early-stage start-ups with less bureaucracy and more upside potential.

Google started to experiment with this informally by encouraging talent to seek out exciting opportunities within the company. And more recently it is notable that their acquisition of Nest has left the brand, team, and separate HQ in place rather than requiring assimilation into the larger organization. Even accounts of Nest’s CEO, Tony Fadell, bear more resemblance to the type of intensity that Jeff Bezos brings to Amazon. All of this is to say that the new Alphabet is going a very different place than the Google we have come to know.

Talent Wars

“95 percent of my assets drive out the gate every evening. It’s my job to maintain a work environment that keeps those people coming back every morning.” — Jim Goodnight, CEO, SAS

There is no absolute right or wrong culture. Love them or hate them companies like Amazon and Google have both accomplished tremendous things while also cultivating dramatically different cultures. I’d venture to guess that the leadership of both companies is keenly aware of the value of their human capital. The right culture is the one that attracts the right people to your company, one that keeps those people there, and one that respectfully lets people go when they aren’t the right fit.