Book - The Amazon Way
Finding clarity
It’s hard to have conviction about whether something will work; and the only thing that I can offer is: every once in a while, you get this crisp moment of clarity where you just know some things are going to work, if you are persistent enough. And those, I think you can only do that if you start with the customer and work backwards. I don’t think you can build that kind of clarity on what your competitors are doing, or what kinds of technologies are available the marketplace. That kind of clarity can only come from a deep understanding of the customer needs. And the good thing about customer needs is, they change slowly in time. So you can count on them. I know for a fact that 10 years from now Amazon’s customers will still want low prices. I know for a fact that Amazon’s customers, 10 years from now, will still want fast delivery. They’ll still want vast selection. And there’s no chance that 10 years from now, somebody will come to me and say, Jeff I love Amazon, I just wish you’ delivered a little more slowly. So because those customer needs are so foundational, sometimes around those things you can get real clarity, and then you can invest and you can know that your investments will pay dividends for customers over time.
Notes from the book: The Amazon Way
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There are two ways to extend a business. Take inventory of what you are good at and extend out from your skills. Or determine what your customers need and work backward, even if it requires learning new skills.
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A vital corollary of learning, humility, and the beginner mindset is the readiness to recognize potential threats wherever they may be.
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Many of Jeff’s standards are unreasonably high. And as a result, efficiency is occasionally sacrificed. In fact, some of the worst leaders I encountered at Amazon were the ones who hid behind ridiculous standard critiques. They became parrots of ideology, instead of being pragmatic in its application. Like any good idea or concept, the idea of high standards can be carried to a non productive extreme.
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When Jeff decided he was going to quit his job and start a company that sold books online, his boss advised him to think about it for forty eight hours before making a final decision. So Jeff sat down and tried to find the right framework in which to make that kind of big decision. In typical Jeff Bezos long-term thinking manner, he referenced something he called his
regret-minimization framework. As he explained in a 2001 interview: I wanted to project myself forward to age 80 and say “Okay, now I am looking back on my life. I want to have minimized the number of regrets I have. I knew that when I was 80 I was not going to regret having tried this. I was not going to regret trying to participate in this thing called the Internet that I thought was going to be a really big deal. I knew that if I failed, I would not regret that, but I knew the one thing I might regret is not ever having tried. I knew that that would haunt me everyday, and so, when I thought about it that way, in was an incredibly easy decision. And, I think that is very good. If you can project yourself out to 80 and sort of think, ‘What will I think at that time?’, it gets you away from some of the daily pieces of confusion. You know you left this Wall Street firm in the middle of the year. When you do that, you walk away from your annual bonus. That is the kind of thing that in the short-term can confuse you, but if you think about the long-term, then you can really make good life decisions that you will not regret later.” This is advice that works well when applied to a personal career decision. But it works just as well when making a decision about the future of your business. Which choice will look best when you consider it, not six months or one year from now, but decades in the future? Chances are that it is the right option - the one that holds the promise of doing really big things.
Notes from the article: Walmart and Amazon’s Race to Rule Shopping - wired.com
There are a couple of tenets of business that we could say Jeff Bezos “borrowed” from Walmart.
- Frugality - when you’re running your company internally, you shouldn’t have any excess spending. Amazon is not the Silicon Valley tech companies that have free lunches and dry cleaning on campus and the like.
- Bias for action - That’s an Amazon leadership principle. Essentially, it means we need to move fast when we’re trying new things. So we might be able to be 80 percent sure that this new idea is great in about two weeks of planning, and maybe it would take us six months to be 100 percent sure we have the right plan. But it is better to move quicker with the best amount of information you have than to hem and haw about new product decisions, new initiatives, and the like.
- Your pricing strategy is your marketing strategy. Essentially, if you keep prices very low, you really don’t have to advertise very much because customers will realize this. It’ll be part of your DNA, part of what consumers expect and trust when they shop with you. And that, at some point in Amazon’s early history, became a key part of how they thought about pricing online.
Other quotes
You can have a job. You can have a career. You can have a calling. If you can somehow figure out how to have a calling, you have hit the jackpot because thats the big deal. A lot of people end up with a job. If you don’t love your work, you are never going to be great at it.
Do something you are very passionate about, and don’t try to chase what is kind of the hot passion of the day.
There is a military phrase that I especially love and that is: - slow is smooth and smooth is fast. And I have seen that in every endeavour I’ve ever been in. Thats the kind of thing that really allows to make progress.
You get certain gifts in life and you want to take advantage of those. But my advice on adversity and success would be to be proud not of your gifts but of your hard work and your choices. The kinds of gifts you can get you know - you might be really good at math, it might be really easy for you. Thats a kind of gift, but practicing that math and taking it to the next step - that could be very challenging and hard and take a lot of sweat. Thats a choice. You can’t really be proud of your gifts because they were given to you. You can be grateful for them and thankful for them. But your choices, you choose to work hard. You choose to do hard things. Those are choices that you can be proud of.
You can choose. We all get to choose our life stories, and it the choices that define us, not our gifts. Everybody has many gifts. I have many gifts. You can never be proud of your gifts because they are gifts. They are given to you. You might be tall or you might be really good at math, or you might be extremely beautiful or handsome. There are many gifts. You can only be proud of your choices because those are the things that you are acting on. One of the most important choices that each of us has, is you can choose a life of ease and comfort, or you can choose a life of service and adventure. And when you are 80, which one of those things do you think are you going to be proud of?
There’s never a better time to be alive. Its just an incredible amount of inspiration that the world generates for me. The amount of change and innovation and oppurtunity is insane.
Every time you figure out a way to provide tools and services that empower other people to deploy their creativity, you are really on to something.
When somebody congratulates Amazon on a good quarter, I say thank you. But what I’m thinking to myself is - those quarterly results were actually pretty much fully baked about 3 years ago. Today I’m working on a quarter that is going to happen in 2020. Not next quarter. Next quarter for all practical purposes is done already and it has probably been done for a couple of years.
— Jeff Bezos, 2017