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August 26, 2020

Can Only Amazon Be Amazon? A Business Strategy Conversation With John Rossman, Author of 'Think Like Amazon'

Written by: Molly Schonthal

Is Amazon the only organization that can act like Amazon? John Rossman, the author of the book "Think Like Amazon" and managing partner at the digital strategy firm Rossman Partners, believes many of Amazon's strategies can be applied successfully to any organization.

Rossman recently led a DSI Executive Forum discussion around this belief, highlighting the many characteristics inherent to Amazon's culture that could benefit brands across the digital shelf. The Digital Shelf Institute (DSI) hosts the DSI Executive Forum, an independent, invitation-only community platform for digital shelf executives at leading brands.

What Does It Mean to be Digital Anyway?

One critical aspect of the Amazon ethos and culture is their interpretation of what it means to be digital. While going "digital" might have varying meanings across the industry, Rossman's Amazon-focused definition is pretty clear-cut.

Rossman defines "digital" through two key attributes:

  • Speed: Efficient, repetitive, and highly precise motion.
  • Agility: The ability to sense and make change efficiently.

Olympic athletes aren't always the only athletes capable of the performances they deliver — they are just capable of delivering those performances consistently over time. Rossman believes this commitment to delivering top-quality results is the same for business strategy: It's through discipline and rigor that brands achieve speed and agility.

Amazon Principles for Digital Shelf Success

Here are some examples of Amazon-focused principles that other companies can adopt for their benefit.

Good, Clear Process vs. Bureaucracy 

Good process is the opposite of bureaucracy, Rossman said. These "good processes" include factors like clarity, definition, accountability, metrics, and a clear road map.

Customer Obsession vs. Hierarchy

For Amazon, customer obsession is the driving force to leveling the organizational playing field and ignore things that don’t matter, such as titles. As long as you come to the table with customer obsession, backed with data, your input is considered more often than not.

A level playing field includes keeping “a healthy tension in the wire.”  The willingness to say when something doesn’t make sense and being openly self-critical is part of a customer-obsessed, widespread ownership mentality.

Future Press Release vs. Consensus Overkill

The discipline of writing things out in a press release helps facilitate communications. It includes imagining why customers love the product, what the ultimate results will be, and what needs to be solved to achieve them are part of the “measure twice, cut once” mentality that sets Amazon apart.

One of the critical barriers to the adoption of agility at large companies is the number of people that need to be brought into the decision-making process. Amazon's decide-and-commit philosophy can seem abrupt to older companies.

Therefore, many of the executives in our forum wanted to know how to handle moving quickly while understanding that everyone wants their say? Rossman believes that the future press release fosters pro-active, widespread communication.

A clear, consistent communication regarding product news and an accompanying FAQ where cross-functional questions are addressed can help. Capturing FAQs with simple, direct answers has the potential to fast-track essential collaboration efforts.

Choosing Investment Over Free Cash Flow vs. Weak Innovation

It's no secret Amazon has chosen growth and reinvestment over profit time and time again. Rossman argued this is an underlying fabric of Amazon culture. One of the reasons this mindset works: It's backed up by the CEO and the board — not just spoken about as an ideal mode of operation.

For strategists like Rossman, the hardest clients to work with are healthy companies because they say they want to innovate, but they aren't willing to put out short-term profitability to help create the future.

Innovation starts with an honest — even brutal — interpretation of where and what you're trying to optimize. But it may be hard to imagine your organization operating in this way.

Rossman's Additional Pointers to Find Success Online

  1. Orient more executive bandwidth toward the future capabilities you need to test and build;
  2. Avoid assigning low-level talent to significant innovation opportunities — and then write them off as failures;
  3. Assign senior executives to these teams and create squads or pods that can learn rapidly with maximum efficiency, giving them a genuine chance to succeed;
  4. Orient teams toward managing risk in the short-term and achieving growth in the long-term;
  5. Ground your case in excellent storytelling and consistently tell the story of what you're building;
  6. If you're not delivering profit, you must deliver something else (e.g., growth);
  7. Think about how you experiment in a stable environment — perhaps by creating a separate tech stack designed for experimentation; and
  8. Don't just look at the risks of investing in the future but also look at the risks of being irrelevant.

Rossman also shared his eight tips for how business leaders can drive innovation within their organizations on the Unpacking the Digital Shelf podcast episode "Lessons We Can Learn from Amazon on Building Winning Strategies and Culture."

CLICK HERE TO LISTEN TO THE PODCAST EPISODE