How Amazon instruments data collection for business reviews
Amazon’s main control processes are S-Team Goal Reviews, QBRs, MBRs, and WBRs. But before any of these reviews can take place, the data to be reviewed must be properly collected. Here is how Amazon instruments this data collection: First, imagine you run a small, single-person business. You do not need lots of instrumentation to understand […]
by Bill Carr
Aligning monthly reviews with annual operating plans
Most leaders manage in a short-term, task-based way. Only the best have the discipline to identify a few immutable drivers of value and focus relentlessly on improving them through experiments that span quarters and years. The challenge is that leaders go through the motions of establishing long-term plans in their annual operating plans (AOP), only […]
by Bill Carr
How Amazon s-team goals drive organizational clarity
Each year, the Amazon S-team (Amazon’s senior leadership group) establishes a list of hundreds of S-team goals. Hundreds! In 2010, there were 452 S-team goals. I wouldn’t be surprised if there are now thousands. These goals were derived from metrics and initiatives proposed by each team during the annual operating plan (OP1) cycle. These were […]
by Bill Carr
Common pitfalls in annual planning and how to avoid them
When I joined Amazon in 1999, it was a high-growth startup with little structure. In particular, our early attempts at annual planning were clumsy. Here are the top 8 pitfalls we have observed along the way: 1) Setting goals but not tracking them Setting goals is easy, but tracking progress with real data requires diligence. […]
by Bill Carr
Key components of a world-class operating plan
When I joined Amazon in 1999, we did not build good operating plans. By the time I left in 2015, our plans were world-class. Here are the components of a great plan so you can skip the 15 years of work that it took us to figure it out: 1) Introduction The Introduction is very […]
by Bill Carr
Understanding the investment envelope in annual planning
At Amazon, one of the most important and misunderstood parts of the Annual Operating Plan is the Investment Envelope. When done right, it aligns executive priorities with the plans of each business unit. When skipped or rushed, it leaves teams planning in a vacuum. The Investment Envelope is the first major step in the OP1 […]
by Bill Carr
Building an effective annual planning calendar at amazon
We iterated and improved Amazon’s annual planning process over many years. One of the mistakes we made early on was not setting out a hyper-detailed calendar for each step of this complex process. Without this detailed calendar, the process could be super frustrating for operating teams who felt whiplashed by ever-changing deadlines, templates, and expectations. […]
by Bill Carr
Trust but verify as a principle for effective management
Trust, but verify. This is a Russian proverb (“doveryay, no proveryay,”) that Ronald Reagan frequently quoted to Mikhail Gorbachev during their Nuclear Treaty discussions. Some of the best leaders at Amazon, like Jeff Wilke, used this phrase too. In Amazon’s case, it may have been something similar (“Trust but Audit”?? Early Amazonians — tell us […]
by Bill Carr
Preventing project delays by identifying dependencies early
A plan is not a real plan if it includes things you “hope” to accomplish. You have to be able to foresee blockers and dependencies. At Amazon, we built systems to ensure all plans included this. As John Doerr wrote in “Measure What Matters”: “Unanticipated dependencies are the number one blocker of projects.” At Amazon, […]
by Bill Carr
How honest reviews maintain a high-performance culture
As a manager, the easy thing to do is to give everyone a great performance review. This avoids conflict, but it is short-sighted. At Amazon, we believed that a high-performance culture required honesty even when it was uncomfortable. The company put systems in place to make sure that happened. One example was the promotion process. […]
by Bill Carr