Business leaders would die to know how Jeff Bezos catapulted Amazon to its behemoth retail success and how the company became the undisputed leader in e-commerce (and other verticals). We’ve discovered that the best way to come close to emulating Amazon’s success is to study the frameworks they used from the beginning.
But how? These frameworks should be secrets known only to Jeff Bezos and the top people at Amazon.
Well, not anymore.
In episode 35 of the Best Places to Lead show, Steve Anderson unlocked the frameworks revealed in Bezos’s 21 letters to Amazon shareholders. He is the author of the international best-seller, The Bezos Letters: 14 Principles to Grow Your Business like Amazon, where he outlined the key lessons, mindset, and steps that made Amazon successful.
I was tempted to ask Steve about all 14 principles from the four growth cycles in his book–Test, Build, Accelerate and Scale–but we focused on the principles I’m most aligned with as a leader.
Here are the top lessons from my talk with Steve Anderson, which I think will be very helpful in driving your business toward success.
Business Lesson #1: Grow your business by welcoming as many failures as possible until you succeed. Keep testing.
The first business lesson is from the first of the four growth cycles in Steve Anderson’s book: the Test Growth Cycle. I was particularly interested in the principle concerning failures.
Yes, most leaders dread failures. However, Steve highlighted that Bezos’s letters encouraged experimentation, which can lead to failure more often than success. For Bezos, these failures provided the direction he needed for the innovative practices that took over the market.
Steve said, “Employees are not afraid of failing. They are afraid of the consequences of failing.” I couldn’t agree more. Leaders encourage innovation – so long as it is successful. Yet, when experiments fail, leaders are normally punitive and end up quashing any type of future innovation.
If you want your business to grow, embrace failures as part of success. Iterate, iterate, iterate. Promoting a culture that penalizes failure discourages experimentation and finding better ways to accomplish tasks. Your business will stagnate.
A great highlight of his thinking: is the Fire phone. While the phone was a dramatic failure, the innovation brought about Alexa, which has been a huge success. I know. We have one in practically every room in the house.
Business lesson #2: Build A Successful Business By Obsessing Over Customers
Business leaders understand the importance of customer service, optimizing the customer experience, and ensuring your customer’s success.
But do you obsess over your customer? This is next level.
Even Steve was intrigued by the use of the word “obsession” in the letters. For Bezos and Amazon, though, it means understanding every aspect of their customers, demographics, wants, needs, and desires than anyone could ever imagine. This allows Amazon to “invent on the customer’s behalf.” It’s next-level consideration of the customer.
Steve considers it a mindset shift from the common understanding of the importance of customers in building a business. Amazon articulates a framework to ensure they are executing on this pillar:
- Obsession with providing a wide selection
- Obsession with low pricing
- Obsession with fast delivery
What if you are obsessed with your customers? How would it change your business?
Business Lesson #3: Run Your Business Every Day Like It’s Day 1
I’ve found that many companies get fat and happy after they’ve “made it.” The more I journey through life, the more I’m convinced: mindset drives success. This is why I love Bezos’ mindset to run Amazon every day like it is “Day One.”
Steve noticed that Bezos always would say something like “it’s still Day One” in the last paragraph of each letter. It became a fundamental principle for Bezos and Amazon, built into their culture and mindset.
Believing it’s the first day at work every day provides the excitement needed to continue working hard, even in the face of tough challenges.
And what happens on Day Two?
When asked about “Day Two” by one of Amazon’s employees at an all-hands meeting in Seattle in 2016, Bezos described: stasis, followed by irrelevance, severe decline, and finally, death. It’s an incredibly clear picture of a disastrous future – and why Day One thinking is critical.
What if you showed up every with the mindset to prove yourself and gain the customer’s trust?
About Best Places to Lead
Your company has the potential to be great. The leader’s responsibility is to unlock that potential – or doom it to mediocrity.
On the LIVE Best Places to Lead show, you’ll learn the hard-fought lessons from the front lines earned by business leaders who have already had their teeth bashed in and lived to tell about it. We’ll share the tips, tricks, mindsets, and frameworks that allow great leaders to lead differently.
Leave a Reply