Jeff Bezos tells shareholders Amazon is still at Day 1
- India’s IT services sector should not be just an outsourcing industry, says Faqir Chand Kohli
- Opening bell: Asian markets open higher, ICICI Securities, Airtel in news
- Capital Float raises $22 million equity funding from Amazon
- Poland to partner with West Bengal to expand bilateral trade with India
- Karnataka assembly elections: BJP releases list of seven candidates
Bengaluru: In a chapter titled “Fever Dreams” in the 2013 business biography on Amazon called The Everything Store, author and journalist Brad Stone highlighted a seminal moment in the history of Amazon and its dynamic founder Jeff Bezos—the emergence of eBay in the middle of 1998.
Faced with the threat of disruption, Bezos and Amazon reacted quickly to the looming threat of eBay’s auction platform and launched Amazon Auctions a few months later. The bet on auctions eventually failed for Amazon, but the episode highlighted Bezos’s endless obsession with the threat of becoming redundant by not focusing on the right customer needs.
Nearly 20 years on, that obsession still continues to be just as strong, judging from the tone of Bezos’s latest missive to shareholders.
In his latest annual letter to shareholders, Amazon chief executive officer Bezos pledged that the e-commerce behemoth would continue to obsess about customers in order to avoid disruption from emerging Internet businesses, insisting throughout that the Seattle-based firm was still “on Day 1” of a journey that has lasted two decades so far.
Also read: Amazon gets RBI nod for e-wallet in India
“‘Jeff, what does Day 2 look like?’ That’s a question I just got at our most recent all-hands meeting. I’ve been reminding people that it’s Day 1 for a couple of decades,” said Bezos, who sits out of a building that is also named Day 1 at Amazon’s global headquarters in Seattle.
“Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1,” added Bezos, who started Amazon in the garage of his Seattle apartment in 1995.
Bezos went on to stress about some of the steps Amazon was taking to avoid becoming what he called a “Day 2 company”.
“Here’s a starter pack of essentials for Day 1 defense: customer obsession, a skeptical view of proxies, the eager adoption of external trends, and high-velocity decision making,” said Bezos. “Staying in Day 1 requires you to experiment patiently, accept failures, plant seeds, protect saplings, and double down when you see customer delight. A customer-obsessed culture best creates the conditions where all of that can happen.”
“As companies get larger and more complex, there’s a tendency to manage to proxies. This comes in many shapes and sizes, and it’s dangerous, subtle, and very Day 2,” he added.
In his letter, Bezos also highlighted some of Amazon’s futuristic bets, especially in areas such as machine learning and artificial intelligence and said Amazon would soon launch more services and offerings in these areas.
“Over the past decades computers have broadly automated tasks that programmers could describe with clear rules and algorithms. Modern machine learning techniques now allow us to do the same for tasks where describing the precise rules is much harder,” said Bezos.
“At Amazon, we’ve been engaged in the practical application of machine learning for many years now. Some of this work is highly visible: our autonomous Prime Air delivery drones; the Amazon Go convenience store that uses machine vision to eliminate checkout lines; and Alexa,1 our cloud-based AI assistant,” he added.
As has become tradition over the past two decades, Bezos also posted a copy of Amazon’s first ever letter to shareholders in 1997, further emphasizing his point on Amazon still being at “Day 1.”
“Day 2 companies make high-quality decisions, but they make high-quality decisions slowly. To keep the energy and dynamism of Day 1, you have to somehow make high-quality, high-velocity decisions. Easy for start-ups and very challenging for large organizations. The senior team at Amazon is determined to keep our decision-making velocity high,” said Bezos.