Amazon has 16 Leadership Principles. You can review all 16 and their meaning on Amazon’s Website. To learn more about how they were developed, read chapter one of our book Working Backwards. Below, we will focus on what makes Amazon’s leadership principles different from nearly every other company, why they are such an effective management tool, and why they are a crucial contributor to Amazon’s phenomenal success. We will also give tips and techniques for developing your Leadership Principles and stress-testing the ones you already have.
Amazon’s leadership principles differ from most companies’ principles or values because they are not just posters on a wall. Nearly every company has a set of principles or values on their website and the walls of the HQ building. These principles often have little effect on the company’s culture, decision-making, or management methods. Frequently, the principles are so generic and undefined that they are useless. “We believe in excellence” could apply to any company, anywhere. Most corporate principles do not impact how employees and managers work each day.
Amazon’s Leadership Principles are not like this. They are woven into every aspect of how everyone at Amazon works, thinks, and acts every hour of every day. They are regularly referenced and quoted verbatim by employees at all levels; their intent is manifested in every workflow and core process, including:
In the early 2000s, Amazon was a fast-growing, global company that had begun diversifying into new products and services beyond e-commerce. The company had become significant and was only going to get bigger. Jeff Bezos realized that he had a problem. He could no longer be in every meeting, participate in hiring and evaluating every leader, or make every decision. He could only be in one place at a time.
Anyone who knows Jeff knows he doesn’t shy away from hard or challenging problems. He often said that solving (the right) hard problems can unlock tremendous value.
His solution to this problem was to find ways to scale his methods of thinking and management. For this to work, he needed to hardcode this into a set of scalable, repeatable processes that could endure for decades after him. Jeff often said, “…at Amazon, we are building an invention machine.”
The leadership principles bind the machine. The machine’s gears are designed to support and reinforce these principles through five scalable and repeatable processes: the Bar Raiser hiring process, the Single-Threaded organization structure, communicating and decision-making via narrative documents, new product innovation via the Working Backwards PR FAQ process, and Input Metrics as the drivers of the operating cadence.
Let’s look at an example of how this works. One of Amazon’s leadership principles is:
Dive Deep. Leaders operate at all levels, stay connected to the details, audit frequently, and are skeptical when metrics and anecdote differ. No task is beneath them.
As Amazon CEO Andy Jassy describes in this video, leaders at Amazon don’t simply come up with great strategies and leave the details to their team. They are expected to be great at both. A strategy is only effective when paired with operational details like customer needs, input metrics, planning, and the ability to execute a plan. Amazon’s metrics and communication processes reinforce the Dive Deep principle.
The Input Metrics method at Amazon requires intense attention to detail and staying on top of hundreds of metrics. Amazon’s communication, meetings, and decision-making use written narratives, not PowerPoint. You can only write an excellent narrative document with a detailed understanding of your business or operation. For the reader, narratives are a high-bandwidth data transfer to Amazon leaders. Given the relative information density of a Word document versus a PowerPoint, Amazon leaders are steeped in roughly 7x more detail and data than their peers at other companies.
Each of the five processes supports and reinforces one or more leadership Principles:
Now that you understand the value of Amazon’s LPs, you may ask yourself, “How can I apply these principles to my company?”
You can’t apply these exact principles because they are unique to Amazon. They won’t work at your company because each has a distinct culture and way of operating. Principles reinforce the most desirable aspects of your current culture. You can seek to have one or two principles that you aspire to, but the majority must be a favorable reflection of your current state. Here are some thoughts to guide you as you seek to develop the principles for your company.
If your organization has a set of codified Leadership Principles or Core Values, you can run them through a stress test by answering the following questions.
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