Why Is Amazon Different? And What Can It Teach You?
Do you wonder why is Amazon different? Do they have a special formula to grow so fast? When Amazon started twenty years ago, not even Warren Buffett saw the company’s potential. He liked Jeff Bezos and saw great potential in him, but a business selling books over the internet didn’t look like something that would change the world forever. Not even the Oracle of Omaha saw that one coming.
Hindsight is 20/20, as they say. But if you looked carefully at Amazon and its leadership, you would have detected specific characteristics which would have hinted at the organization’s future success. Yes, there was a bit of luck involved: Amazon was in the right place at the right time. But the firm also does a lot of stuff right – things that startups and small business can learn from.
Amazon Is Committed To Its Vision, But Flexible About How It Gets There
Amazon’s mission is big: it wants to be the world’s most customer-centric company, providing people with whatever they need, when they need it. Unlike many firms, Amazon’s mission is unapologetically broad. Being a customer-centric company that provides customers with whatever they want could encompass practically anything.
It brings up an interesting question: what exactly is Amazon? Is it an e-commerce store, a space company, an IT company? Maybe an AI research lab? Is it an advertising platform? The answer is that it’s all of those things and more. What binds the whole lot together – other than Bezos’ personal direction – is the notion that the company exists to serve customers.
Amazon doesn’t limit itself to any particular field of endeavor. If it believes that it needs to make a move from selling books to launching rockets, then it will. Amazon is the quintessentially flexible company: it has a core mission, but it’s not afraid to experiment with different ways of getting there.
Entrepreneurs could learn a lot from this approach. Amazon’s mission is something that the market will always want: excellent service. But the e-commerce giant doesn’t box itself in by assuming what great service means: it could be wrong. People starting their own businesses could benefit from a similar attitude. You never quite know what the market will like, and what it won’t, so it pays to be flexible with your approach, but stubborn in your goals.
You may also want to check out my post on marketing goals you should focus on.
Use The “Two Pizza” Rule
Many of the biggest companies in the world use complicated management structures: teams of thirty or more, and intricate lines of communication which get easily jammed. Large groups don’t work, but they emerge in companies through a combination of bureaucratic incentives and poor management.
Amazon tries to avoid this by using the “two pizza” rule. It works something like this: you should be able to feed the people working on any particular project with just two pizza. Any more than that, and there are too many people on the project.
How many people do two pizzas feed? Five to seven at the most in Jeff Bezos’s opinion.
Why Amazon Is Different, They Invent New Solutions To Age-Old Problems
The famous physicist Richard Feynman often used to talk about his procedure for solving difficult problems in physics. It went something like this: read the question. Think really hard. Write down the answer. It was a great way of communicating the fact that sometimes there are no shortcuts, and you have to use the brute force of your intellect to come up with solutions.
Amazon takes a similar tack. The company likes to invent things from scratch if there’s nothing already out there that will do the job. Just look at the firm’s fulfillment centers. Not only does Amazon work with a variety of conveyor belt manufacturers, but it also invented its own robot system after purchasing the robotics startup Kiva. Amazon recognized that it could be years before a third-party company developed an automated warehousing solution, so it took it upon itself to solve the problem itself with a fleet of specialists robots.
As a small business, your task is primarily to do things differently from your competitors, even if that’s just in a small way. You don’t have to make giant strides forward: only do things 10 percent better than your competitors. Invent your way to greater market share. Inventions in any area of your business, be it customer service or greater automation can be the difference between winning a new client and not.
Check out this post on online marketing investments to learn about some of the best tools you can use to outpace your competition.
Take The Long View
We live in a world desperate for quick fixes and easy solutions to complex problems. But when you look at some of the most successful firms in the world, including Amazon, that’s not their view at all. It’s hard to believe that Amazon was only seriously profitable from last year onwards. Throughout the rest of its history, the firm has reinvested practically everything it’s made into creating new and better products and services. It took Amazon ten years to turn any profit at all.
Bezos managed to achieve the success he did by finding a small group of investors who could see the long-term vision of what he wanted to do and then got them to provide the money for it. Returns were not guaranteed, but the company soon delivered, even before profits took off. By 2012, the market finally recognized that Amazon was something special, and the stock price took off, six years before net profits took up a substantial percentage of revenues.
Get Rid Of Presentations
In regular company meetings, one particular member of staff stands up at the front and gives a presentation. But that’s not how Amazon likes to do things.
In Amazon’s view, the audience gets very little value from a presentation. The presenters might understand that topics inside out, but it’s hard for anyone else to derive insight from a list of bullet points. Amazon, therefore, prefers to use “memoranda,” or paragraphs of more highly developed text which effectively communicate ideas and provide deeper clarity.
Why Amazon is different is because they do things differently from the average company, and the net effects show up in above-average results. Amazon has been around for more than twenty years, and there’s no sign that it’s done yet.
If you want above average results like Amazon growing your business, check out this Free Lead Generation Training to learn how to get 5-10 new quality leads a day for your business!
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