A disruptive innovation podcast Created by ARK Invest, FYI – For Your Innovation is a podcast providing insights into recent disruptive developments and innovation. ARK is best known for its Exchange-Traded Fund (ETF) ARKK, which includes stocks such as Tesla, Crispr, and Square. Each episode is [...]
By Alvin Mak
Professional speaker and consultant, Steve Anderson, has possibly provided the best look at the inner workings and philosophies of Amazon from the outside. Anderson analyzed each of Bezos’ annual letters to shareowners and extracted 14 principles of growth exercised at Amazon. Split into 4 “Growth Cycles”—Test, Build, Accelerate, and Scale—Anderson explains how these 14 distinct principles can help businesses, startups to Fortune 500 alike, achieve significant growth in The Bezos Letters.
Anderson uses the 14 principles to turn orthodox business philosophies on their head. The careful unpacking of Bezos’s letters unveils hows to set your company up for success, as demonstrated by the ecommerce behemoth, which recently surpassed Apple and Google with its US$315.5 billion valuation (CNBC).
Immediately, it is clear that innovation is fundamentally built into Amazon’s identity, which explains its mind-boggling growth over its lifetime. Anderson’s principle of ‘Understanding Your Flywheel’ breaks down how the company is driven by customer experience, traffic, low prices, and so on. The ‘flywheel’ concept is the idea that momentum is gained imperceptibly and with much effort until the point of a breakthrough.
Another principle highlighted by Anderson is Bezos’ relentless ‘Obsess[ion] Over Customers.’ It’s evident that Amazon doesn’t bother itself with its competitors because it’s the happiness of Amazon’s customers that lead to retention and growth. Amazon’s ability to fearlessly innovate and “Make Complexity Simple” for its customers remains a defining trait.
In one of the most interesting sections of the book, Anderson underlines Amazon’s take on risk. Bezos is frequently labeled as a “master of risk, as demonstrated by how he boldly, perhaps recklessly, left his job to open an online book store, back when an online business was “a crap shoot, as best.”
He stresses that risk is an investment, and growth doesn’t come if risks aren’t taken. Even if risks don’t pay off, Anderson emphasizes that failure is a good learning opportunity and is never the end of the world. As Bezos wrote in one of the letters: “so what if you’re wrong?”
Anderson harks back to Apollo 13 (it is revealed that Bezos has a deep fascination with space), reminding readers of the value of mistakes; failure only counts when nothing is learned. Anderson ultimately highlights the beauty in failing and “glass-half-full” mentality in his thought-provoking, inspiring, and easy read.–AM
Cover art courtesy of Alarice.