This is a fascinating look at Amazon's CEO. Not only does it give a glimpse of one of the most important aspects of any company, i.e. management, it also provides a glimpse into what has helped develop an innovative culture at the company. Originally posted to WP here.
By Craig Timberg and Jia Lynn Yang,
This demanding style is as much a signature of the Amazon.com founder as his famously long-term approach to developing new products or services, say people who have worked with the man who this week agreed to buy The Washington Post for $250 million. Bezos (pronounced “BAY-zohs”) has developed a precise and inventive approach to management that has powered Amazon to the top ranks of U.S. technology companies.
He favors a nimble, loosely organized company in which “two-pizza teams” execute important corporate tasks, because a work group requiring three pizzas over a lunch meeting is inherently too cumbersome. And he often requires employees pitching new ideas to write mock news releases for their product’s imagined launch, a way of focusing their minds on what will most excite customers.
Annual salaries at Amazon are modest by the standards of the technology industry, with compensation weighted toward lucrative stock benefits designed to instill a sense of ownership and long-term purpose among employees. The key is measurable performance. His management team produces what some have called ruthless annual evaluations; top performers get larger stock benefits while laggards sometimes face pointed suggestions that they find new jobs.
“One thing I learned is when you got a meeting with him, you’d better be ready,” said Nadia Shouraboura, who until recently worked on Amazon’s senior executive team reporting directly to Bezos. “He will figure out something you haven’t thought of. . . . If you haven’t thought through exactly how to delight our customer, that’s a bad thing.”
There is an outwardly genial side to Bezos, 49, a father of four who has an outsize laugh and appears to revel in the salesmanship of a product launch as he strides the stage in jeans and a dress shirt. But inside is a drive for perfection, manifested by an unwillingness to waste time or energy.
The recruiting motto: “Work hard, have fun, make history.” Or, as Bezos put it in his first letter to shareholders, in 1997, “It’s not easy to work here (when I interview people I tell them, ‘You can work long, hard, or smart, but at Amazon.com you can’t choose two out of three’).”
Kal Raman, a former top Amazon executive who is now chief operating officer for Groupon, recalled the consuming sense of mission instilled by Bezos. “When you try to rewrite history, it doesn't come without blood, sweat, tears and sacrifice. He doesn’t hold you to any standard he doesn’t hold to himself.”
In describing Bezos, the most common comparison is to Apple co-founder Steve Jobs, who was single-minded in his devotion to every new product. But while Jobs, who died in 2011, is often described as a design visionary, capable of discerning what consumers one day will want, Bezos has focused on delivering whatever they currently desire — as quickly as possible. Delays are not accidents or misfortunes but “defects” to be eradicated, he has said.
The result is a company that has become among the world’s most powerful retailers, a leader in the burgeoning world of cloud computing systems and a player in a range of other businesses — book publishing, television production, electronics manufacturing.
Bezos, who founded Amazon in his Seattle area home in 1995, meanwhile has become one of the country’s wealthiest men, with an estimated $25 billion in assets and plaudits from Time, Harvard Business Review and legendary investor Warren Buffett, who has hailed Bezos as “the ablest CEO in America,” according to Washington Post Co. chief executive Donald E. Graham.
Bezos has no patience for bureaucracy, and employees are encouraged to put a stop to anything that smacks of jumping through hoops. A rule requiring that employees who brought their dogs to work sign in the animals disappeared soon after complaints. Bezos also disdains the formality of job titles, encouraging employees to work outside the scope of their titles if it helps the company.
One of the most coveted honors at Amazon is the “Just Do It” award, given to an employee every couple of months who strays from his or her job title to do something that will help Amazon. Bezos helps choose the employee himself and then hands the award — an old Nike shoe — to the winner at a company-wide event.
Those who win the award proudly hang the shoes in their cubicles; in the online directory, a small icon is placed next to the names of those who win.
“It was not the title but rather who’s got the best idea,” said John Rossman, who worked at Amazon from 2002 to 2005 as an executive and is now managing director at Alvarez & Marsal, a consulting firm. “Who’s bringing the solution to the table? That’s what was most important.” What is not clear, even to some of those who have worked for Bezos, is how his management style translates into running a newspaper amid a historic decline in readership and revenue that has afflicted the entire industry.
Bezos has said little about his plans for The Post since the sale was announced Monday, though in a letter to employees he made clear his desire to accelerate the pace of innovation at a company that for years has struggled amid the same digital transition that made online companies such as Amazon rich. The company, which will have no ownership stake in The Post, declined to comment for this story.
“The Internet is transforming almost every element of the news business: shortening news cycles, eroding long-reliable revenue sources, and enabling new kinds of competition, some of which bear little or no news-gathering costs,” Bezos wrote. “There is no map, and charting a path ahead will not be easy. We will need to invent, which means we will need to experiment.” Bezos encouraged a culture of experimentation at Amazon, where failure is accepted so long as it yields new lessons.
“Most things at Amazon are viewed as an experiment,” said Jason Crawford, who worked at Amazon as a development manager from 2004 to 2007. “And that means a few things: You don’t assume it’s going to work before you try it, but that’s also okay. The goal is try things. We’re going to measure them and find out if they work.” Amazon was a pioneer of the now common practice at tech companies such as Facebook — testing different versions of the company’s Web site with different audiences to see what works, Crawford said. Half the users might see a new feature, while the others do not. Amazon employees would then measure the results to see if the features encouraged people to buy more or stay longer on the site.
Bezos has said that he intends to keep his focus on Amazon and keep his home in the Seattle area rather than becoming a fixture in Washington, as four generations of The Post’s outgoing owners, the Graham family, have been. Bezos also has agreed to keep the newspaper’s top executives in place, though they may need to work without a popular corporate management tool: PowerPoint presentations.
Bezos all but banned such presentations at Amazon around the time Edward Tufte, a computer science professor at Yale, wrote an essay saying that their bullet points encouraged lazy thinking. Amazon employees are required to write papers, known as “narratives,” that are no longer than six pages. The idea for Bezos, former employees say, is that the act of writing forces people to focus their thoughts and think them through. Bezos’s faith in the enduring power of words is evident in his own annual letters to shareholders. His letter in 1997 is regarded as something of a founding document for Amazon, highlighting his obsession over serving customers and developing plans that take years to bring to fruition. That consistent long-term view — he often talks of seven-year cycles for executing business plans — is the counterpoint to his minute-by-minute quest to avoid wasting time.
“Jeff has always been very efficient,” said Jason Kilar, who worked at Amazon from 1997 to 2006, rising to the level of senior vice president. “There is one very important thing he knows is not in abundant supply on Earth, and that is minutes.” But he added: “He has the patience to invest if he believes the strategy is the right one.”
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