I joined Amazon in 1999. In those early years, Jeff and the leadership team would tweak our strategy every year. Often, the strategy revolved around very specific goals for the next year. This changed in 2002.
The “old way” was consistent with how many companies operate. They update or revise their strategy annually.
We stopped this annual cycle of strategic iteration once we established our growth flywheel (Inspired by Jim Collins). We began to focus on the same things year after year.
The value drivers of our flywheel were simple: broad selection, low prices and exceptional customer experience.
Every year we focused on improving the same key elements that would drive sustained success—because no one ever gets tired of lower prices, better selection, and fast delivery.
This simplicity was powerful—because from that point on, the entire organization could align. Every operating plan was built around those pillars.
No ambiguity. Just: “What are you doing for selection? For low cost structure to enable lower prices? For an easier shopping experience? For fast delivery?”
But simplicity on paper doesn’t mean simplicity in execution. Achieving simplicity for the customer requires a rigorous focus on the details— “Retail is Detail”
How do we manage inventory for millions of items? How do we fulfill each order faster and cheaper? How do we build metrics that capture what our customers experience?
By grinding on these same problems year after year, we improved.
That’s the essence of the flywheel. No big breakthroughs, just compounding advantages through consistent, measurable progress.
That’s what Amazon has been doing for decades.
It is easy for companies to fall into the trap of strategic novelty and complexity. They gain a false sense of security and precision from new, complex or seemingly sophisticated plans. But in my experience, great companies—like Apple, Walmart, and Amazon—don’t do that.
The greatest companies master simplicity.
Building a billion-dollar company is, in a way, boring. You need a simple, durable strategy—and the patience and discipline to execute it, year after year.
For more insight into how and why Amazon became the company we know today, check out our book Working Backwards:
