Amazon & Agile: How Amazon Drives Success Through Agile Management
It goes without saying that Amazon is one of the most successful companies in the world. What started in the 90’s as a company that sells books has now grown into a monolith of a brand with an estimated net worth of $1.7 trillion. Its reach continues to expand by the day, from delivering goods to your doorstep, to providing video streams of movies, TV shows, and soon sports, to its other services such as Amazon Web Services, Amazon Games, and Amazon Music. Under the leadership of current CEO Andy Jassy, it seems as though the company only continues to expand in the foreseeable future.
That being said, Amazon’s success is not just rooted in its ability to keep up with the times and exceed its expectations, but it’s also largely due to their philosophies that are rooted in Agile Management. If the main focus of the Agile Management way of working is producing products quickly and with high quality, then Amazon does this and then some. It’s something that all companies should strive to emulate in their own proceedings. But how exactly do they practice it? They practice Agile Management through these three key points:
- Putting The Customer At The Forefront
In Agile Management, everything begins and ends with the customer.
During every team meeting in Amazon, regardless of hierarchy, one seat is always left empty. For whom is that seat for? It’s for what Jeff Bezos calls the most important person in the room: the customer.
“Obsessing over customer experience is the only long-term defensible competitive advantage,” Bezos has said.
In an interview with TIME Magazine for their 2022 edition of the Top 100 Most Influential Companies, Andy Jesse spoke to John Simons about what Amazon essentially is:
“We exist to make customers’ lives better, and we think about it as needing to relentlessly invent to make that so. If there’s a customer experience that, if we fixed it, could be a large meaningful business for the company, we will pursue it. Even if it has very little to do with our existing businesses.”
Amazon is well known for putting customers that the center of their business, which is one of the core principles of Agile Management. This is further backed up by a survey of 2000+ US customers, where 89% agree that they’re more likely to buy products from Amazon than other ecommerce sites (Feedvisor, 2019). In Agile Management
Earning the trust of customers is the stepping stone not just to Agile Management, but to success as a company and brand in general. If you have a brand or a business, you should think about building and nurturing customer relationships. Customer relationships come with a consistent experience of focusing on true and clear product information, as well as providing relevant content, encouraging reviews, and quality product services.
2. Decentralized Leadership
Amazon’s teams are given wide discretion to solve their own problems without detailed regulation from a central authority. Decentralized decision-making power enables teams to build, deploy, and operate high-quality software in a streamlined, non-bureaucratic manner. It’s a necessary style of leadership in order to activate the Agile Management manifesto.
In the same interview with TIME, Andy Jasse said the following when asked about managing Amazon:
“We operate in a decentralized fashion where there’s a lot of autonomy and a lot of ownership. It starts with having great leaders. And then I think a big piece of a company scaling has to do with the culture inside the company. You can’t flip a switch and have that happen.”
In Amazon, leaders are owners. They think about the long-term instead of the short term, and they encourage teamwork, synergy, and an infectious culture of pursuing perfection. All of this is only possible when leaders are given the trust to get the job done, instead of being constantly micromanaged with every action point.
- Maintaining Flexibility And Embracing Change On-The-Go
Maintaining flexibility as a team goes hand in hand with decentralized leadership because both contribute to the very word synonymous with Agile: speed. As Andy Jasse shared,
“Speed is not preordained. It’s very much a leadership decision and a cultural decision. There are a few ways that you can speed up. The first is if you organize in a decentralized fashion where businesses don’t have to constantly be coordinating with one another. The second thing is making sure that you identify which are the one-way-door decisions and which are the two-way-door decisions.
The two-way-door decisions means that if you get it wrong, you can walk back through that door and just stop doing it. The one-way-door decisions are: if you get this wrong, it’s either impossible or very difficult to walk back. Those you have to go a little slower on.”
The good news is that there are more two-way-door decisions than there are one-way-door ones, Andy mentioned. Decentralized teams are encouraged to be swift in making decisions when it comes to these two-way-door decisions, and taking their time with one-way-door decisions. This ties in to a key idea of Agile Management: welcoming changing requirements.
Things change over time. Mistakes can be made, and there should be a leeway in starting, stopping and continuing certain matters. Maintaining flexibility will do wonders in conflict management and will enhance the agility of the team.
Revitalize Your Team With Agile Today
So in summary, Amazon’s success can be credited to their culture and philosophy rooted in Agile Management, manifested through their customer-mindset, their method of working in small teams with a decentralized leadership, and equipped with the flexibility to embrace change on-the-go. All of these motivate their teams to think big and innovate, allowing them to produce products and solve problems quickly and with high quality.
Are you ready to take your team to the next step? Click here to check out our courses in Agile Management, where you can learn more about the Agile mindset, its values, principles, foundational concepts and all things related to Agile! Feel free to also check out our other resources on Agile Methodology here on our website!
