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Amazon’s Leadership Principles And What All Business Leaders Can Learn From Them

Amazon has grown from being an online bookstore to one of the largest retailers in the world. In the process Jeff Bezo’s, the Founder of Amazon, has been propelled to the richest person on the planet with a net worth of over $100 billion.

Therefore it should come as no surprise that many entrepreneurs, CEO’s and business leaders look to Amazon as a shining light on how to grow a company of massive scope and scale.

The good news on this front is that Amazon is guided by a number of publicly available leadership principles that give us clear insight into how the company thinks and operates.

In this post we are going to share Amazon’s leadership principles and highlight the key lessons we should all take away from them.

1. Customer Obsession

Amazon Leadership Principles - Customer Obsession

Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers.

As any veteran businessperson will tell you, every business exists solely for its customers. If you want to flourish, you must focus on your customers first and the competition second.

Why? because it doesn’t matter how well you can attract customers from your competitors. If you can keep and retain them, then all that work if for naught.

Ultimately if you win over your customers you can win over your competitors.

2. Ownership

Amazon Leadership Principles - Ownership

Leaders are owners. They think long term and don’t sacrifice long-term value for short-term results. They act on behalf of the entire company, beyond just their own team. They never say “that’s not my job”.

Jeff Bezos always had a plan to make Amazon more than just an online bookstore. For years Amazon continued to lose money and faced calls from shareholders to cut costs and focus on turning a profit.

But Jeff Bezos doesn’t think in quarters or even years. He thinks in terms of decades and the overall arch of his life.

For leaders looking to step up this translates to thinking beyond your next task or assignment. You always have to have the big picture in mind. Where do you want to be 3, 5, 10, or 20 years time and what are you doing today to help get you there tomorrow?

3. Invent and Simply

Amazon Leadership Principles - Invent and Simply

Leaders expect and require innovation and invention from their teams and always find ways to simplify. They are externally aware, look for new ideas from everywhere, and are not limited by “not invented here”. As we do new things, we accept that we may be misunderstood for long periods of time.

In running a business or managing an organization, you will inevitably run into problems. How you approach those problems shows exactly what kind of leader you are.

There are people who solve problems the same way they always have. Then there are those who look for innovative solutions that are simpler to execute and that are far more effective. If you want to be more successful, you ought to belong to the latter category.

Successful leaders are not afraid to try out new ideas as well. They accept that it won’t always work out but the risk of doing nothing is far greater than the risk of getting it wrong initially.

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4. Are Right, A Lot

Amazon Leadership Principles - Are Right Alot

Leaders are right a lot. They have strong judgment and good instincts. They seek diverse perspectives and work to disconfirm their beliefs.

Leaders have to make a lot of decisions in the course of the day. A good leader needs to make more right decisions than wrong ones.

As a result a leader needs to have good judgment, and they must also have good instincts. Having good judgment is not merely a matter of having an innate gift of always making the right call: it is also about making informed decisions.

5. Learn and Be Curious

Amazon Leadership Principles - Learn and Be Curious

Leaders are never done learning and always seek to improve themselves. They are curious about new possibilities and act to explore them.

For a leader, there is no end to learning. Every new challenge, problem or experience is an opportunity to learn.

As a leader, you must constantly keep improving yourself. It is only by learning new things that you will conceive new possibilities. You must also have the guts to explore the new possibilities, knowing well that the risk could help your company grow significantly.

6. Hire and Develop the Best

Amazon Leadership Principles - Hire and Develop The Best

Leaders raise the performance bar with every hire and promotion. They recognize exceptional talent, and willingly move them throughout the organization. Leaders develop leaders and take seriously their role in coaching others. We work on behalf of our people to invent mechanisms for development like Career Choice.

A leader is only as good as the team they lead, so you must make sure that the people you are in charge are the best. This means that your hiring process needs to be rigorous, only hiring the very best of those who apply for the job.

For years it has been stated that Amazon has a policy of only bringing on a new staff member if they are better than 50% of their existing team. Whether this is 100% true or not, what it shows is that the mindset of the people at Amazon is to always improve and to ensure that they only hire the very best.

7. Insist on The Highest Standards

Amazon Leadership Principles - High Standards

Leaders have relentlessly high standards – many people may think these standards are unreasonably high. Leaders are continually raising the bar and drive their teams to deliver high quality products, services and processes. Leaders ensure that defects do not get sent down the line and that problems are fixed so they stay fixed.

Successful leaders should have very high standards for everything they do. They also need to constantly push their team to achieve their maximum potential. Sometimes, people will see you as a perfectionist, but it is the price you have to pay in order to achieve your goals.

Insist that your employees offer customers the very best services, or that they produce superior quality goods. Also, ensure that defects are fixed as soon as they are noted rather than being swept under the mat. Be ready to meet with resistance, but it will certainly pay off in the long run.

8. Think Big

Amazon Leadership Principles - Think Big

Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold direction that inspires results. They think differently and look around corners for ways to serve customers.

A leader cannot afford to be small minded. Your team relies on you for guidance and inspiration, so you must provide them with a big vision to work towards.

Dare to dream big, and sell this dream to your team. You will be surprised to see the lengths they can go to in order to make your dream come true. This is important, because no one is going to get excited over a small goal. If you aim small, you achieve small. So think big!

9. Bias for Action

Amazon Leadership Principles - Bias For Action

Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk taking.

Leaders often need to make fast decisions in order to keep the organization running. Sometimes, those decisions may not be the best, but they are necessary.

If these actions or decisions can be easily reversed, don’t think twice about making them. Sometimes, you just won’t have that much time. this is especially important if you are running a startup. Your competitors are moving fast and you need to as well. Don’t waste time on making small decisions, focus that energy and time on the big company shifting changes that are more important.

10. Frugality

Amazon Leadership Principles - Frugality

Accomplish more with less. Constraints breed resourcefulness, self-sufficiency and invention. There are no extra points for growing headcount, budget size or fixed expense.

Make a habit of spending money only when it is absolutely necessary. People usually become exceptionally resourceful and self- sufficient when there isn’t that much money to spend. You may save plenty of costs and still achieve the very same goals.

It’s interesting that this is a principle for Amazon still to this day. Despite being one of the most valuable companies in the world Amazon still recognizes that money can’t be spent recklessly.

11. Earn Trust

Amazon Leadership Principles - Earn Trust

Leaders listen attentively, speak candidly, and treat others respectfully. They are vocally self-critical, even when doing so is awkward or embarrassing. Leaders do not believe their or their team’s body odor smells of perfume. They benchmark themselves and their teams against the best.

A leader needs to be trustworthy. People need to know that they can count on you, and that you always tell the truth.

You must also not be conceited. It is important that you have a sane estimate of your abilities and the wisdom of your decisions. Listen to the ideas of others without feeling too self- important, and then make the right decision.

12. Dive Deep

Amazon Leadership Principles - 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.

You also need to be involved in all levels of running your company. No kind of work should be beneath you. Don’t take the small things for granted: they can be the difference between your success and dismal failure.

That doesn’t however mean that you need to micro-manage. It means that you need to be aware of what is happening in your business and around it. You can help make this process easier for you by hiring quality people who you can trust and who won’t be afraid to help you the truth of what is really happening.

13. Have Backbone: Disagree and Commit

Amazon Leadership Principles - Have Backbone

Leaders are obligated to respectfully challenge decisions when they disagree, even when doing so is uncomfortable or exhausting. Leaders have conviction and are tenacious. They do not compromise for the sake of social cohesion. Once a decision is determined, they commit wholly.

As a leader, you will often have to make tough decisions. Sometimes, this takes the form of challenging decisions you do not agree to, even if it may rub some people the wrong way. It is your duty, and you simply mustn’t sleep on it.

Once you make a decision, follow it through to completion. Your reliability speaks volumes about your leadership skills.

14. Deliver Results

Amazon Leadership Principles - Lead

Leaders focus on the key inputs for their business and deliver them with the right quality and in a timely fashion. Despite setbacks, they rise to the occasion and never settle.

Finally, a good leader must be able to deliver results and keep to their promises. If you set a goal for yourself or your organization then as a good leader you must have a plan that will allow you to get there.
If you constantly over promise and under deliver not only do you create an environment where people don’t trust in your ability to lead them, but motivation and morale in your team can also drop.

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Also published on Medium.