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Culture of Innovation

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From its humble beginnings as a startup in a garage, Amazon has not only innovated across e-commerce, but also introduced new, diverse businesses. Join us to discover how Amazon approaches innovation, with its mechanisms, architecture, culture, and organization, with an emphasis on how some of these factors can help other organizations.

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Culture of Innovation

  1. 1. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Nathan Klein, Account Executive, AWS Amazon’s Culture of Innovation Enabling everyone to innovate
  2. 2. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Our mission to be Earth’s most customer-centric company
  3. 3. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Where innovation begins start with the customer and work backwards
  4. 4. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. “There are many advantages to a customer- centric approach, but here’s the big one: Customers are always beautifully, wonderfully dissatisfied, even when they report being happy and business is great. Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf.” – Jeff Bezos, 2016 letter to shareholders
  5. 5. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Growth flywheel > Price > Selection > Convenience © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  6. 6. 1994 m Founded 1995 m Amazon.com 1998 m CDs and DVDs 2006 m AWS 2007 m Kindle 2011 m Video 2012 m Groceries 2014 m Alexa/Echo 2015 m Bookstores 2017 m Go http://phx.corporate-ir.net/phoenix.zhtml?c=176060&p=irol-corporatetimeline
  7. 7. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. How do we organize for innovation? Culture Customer obsession, hire builders, let them build, support them with a belief system Mechanisms Encoded behaviors that facilitate innovative thinking Architecture Structure that supports rapid growth and change Organization Small, empowered teams that own what they create
  8. 8. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. How do we organize for innovation? Culture Customer obsession, hire builders, let them build, support them with a belief system Mechanisms Encoded behaviors that facilitate innovative thinking Architecture Structure that supports rapid growth and change Organization Small, empowered teams that own what they create
  9. 9. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Every one of us is a leader on our mission. Invent and Simplify Hire and Develop the Best Frugality Deliver Results Are Right, A Lot Dive Deep Bias for Action Insist on the Highest Standards Earn Trust Ownership Think Big Customer Obsession Have Backbone, Disagree & Commit Learn and Be Curious © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. ,
  10. 10. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Invent and simplify Leaders expect and require innovation and invention from their teams. They 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.
  11. 11. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Willingness to be misunderstood for a long time…
  12. 12. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. 71 price reductions (since ‘06) 1,957 new services and features introduced in FY 18 Millions of monthly active customers
  13. 13. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  14. 14. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Bias for action Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk taking.
  15. 15. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Is it a one-way or a two-way door?
  16. 16. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. How do we organize for innovation? Culture Customer obsession, hire builders, let them build, support them with a belief system Mechanisms Encoded behaviors that facilitate innovative thinking Architecture Structure that supports rapid growth and change Organization Small, empowered teams that own what they create
  17. 17. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. A mechanism is a complete process.
  18. 18. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Working Backwards is a process. Use it to get clarity, not to document what you’ve already decided to do. Customer Press release FAQ Visuals
  19. 19. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Who is the customer? Be specific about their context and needs. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  20. 20. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  21. 21. Artifacts from the Working Backwards process Press Release FAQs Visuals
  22. 22. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. FAQs • Include both customer FAQs and internal FAQs • Include the hard questions • Share your press release early to gather questions Sample Customer FAQs: 1. How is this different from what Amazon offers me today? 2. Can I get a refund if I’m dissatisfied? 3. Are there things I need to manage or keep track of? 4. How much does this cost? Sample Internal FAQs: 1. What decisions and guidance do we need today? 2. What customer feedback have we collected so far? 3. What will customers be most disappointed in? 4. What other options did we consider and reject? 5. What are our hotly debated topics? 6. Are we stepping through any one way doors? 7. Who is the single threaded leader?
  23. 23. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Visuals • Show the customer experience • Rough idea – rough drawing • Match fidelity to maturity of your idea • Don’t be afraid to be provocative
  24. 24. We read, discuss, debate, and ask questions. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  25. 25. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Stubborn on the vision but flexible on the details
  26. 26. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. How do we organize for innovation? Culture Customer obsession, hire builders, let them build, support them with a belief system Mechanisms Encoded behaviors that facilitate innovative thinking Architecture Structure that supports rapid growth and change Organization Small, empowered teams that own what they create
  27. 27. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. A shift to microservices • Single-purpose • Connect only through hardened APIs • Largely “black boxes” to each other • Business logic and data only accessible through APIs © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  28. 28. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Self-service platforms without gatekeepers Creating powerful self-service platforms that enable builders to use the right tool for the right job © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  29. 29. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  30. 30. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. How do we organize for innovation? Culture Customer obsession, hire builders, let them build, support them with a belief system Mechanisms Encoded behaviors that facilitate innovative thinking Architecture Structure that supports rapid growth and change Organization Small, empowered teams that own what they create
  31. 31. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Amazon hires builders and lets them build © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  32. 32. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Two pizza teams are fast and agile, fostering ownership and autonomy Small, decentralized teams are nimble Own and run what you build © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  33. 33. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Experiment early and frequently © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  34. 34. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Auctions, zShops, Marketplace Learn from failures… fire Phone
  35. 35. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. How do we organize for innovation? Culture Customer obsession, hire builders, let them build, support them with a belief system Mechanisms Encoded behaviors that facilitate innovative thinking Architecture Structure that supports rapid growth and change Organization Small, empowered teams that own what they create
  36. 36. “Invention comes in many forms and at many scales. The most radical and transformative of inventions are often those that empower others to unleash their creativity – to pursue their dreams.” Jeff Bezos Founder and Chief Executive Officer Amazon.com, Inc. © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
  37. 37. Thank you 3

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