Day 1 Amazon Thinking

July 2, 2018
|In Videos, Article
|By lawrenceandco

The essence of Day 1 Amazon Thinking – described in Bezos’ 2017 shareholder letter – is how the people at Amazon keep the company fresh by maintaining a customer-oriented focus.

Day 1 describes the fight and fire and determination you have to do all the best things for your clients. Strong in the beginning, it often fades over time as you become more self-oriented versus customer-oriented, which can weaken your business, and really end up hurting you.

Day 2 is stasis, followed by irrelevance, followed by excruciatingly painful decline, followed by death. And that’s why it’s always Day 1. To be sure, this kind of decline would happen in extreme slow motion – an established company might harvest Day 2 for decades – but the result would still come.

I’m interested in these questions:

  • How do you fend off Day 2?
  • What are the techniques and tactics?
  • How do you keep the vitality of Day 1 inside a large organization?

Such questions can’t have a simple answer. There may be many elements, multiple paths, many traps. I don’t know the whole answer, but I may know bits of it.

Day 1 Amazon Thinking Essentials

Here’s a starter pack of essentials for Day 1 defence – and Bezos gets into these four points and measures, which you can read about in more detail in his letter – and which make a great self-assessment, for you and your team, when you’re doing your next planning session:

  1. Customer obsession. It’s about being obsessed with pleasing the customer and knowing that they’re always happily dissatisfied – meaning there are more things that they would like or enjoy, but they don’t even know yet. So, there are always huge opportunities to please them. And if you watch Amazon, they continually release new products and services that make you thrilled if you’re a customer. So, here’s the question for your team: On a scale of zero to 10, how would we rate a true customer obsession, compared to this Day 1 thinking?
  2. Outcome-orientation. Bezos says that many companies, as they grow, become process-orientated e.g. “We’re doing the work, we’re doing the project, we’re revising the policy, we’re implementing the system,” but they forget to measure, “Did we get the dollars and cents out of it? Or the results we actually required?” When you’re a start-up, it’s easy because you have no cash, and everything has to work – but when you get bigger, with more resources, people often start to focus on doing the work versus getting the result. I see this in companies all the time: people are doing good work but because the finish line is not clear enough, they sometimes don’t get there. 
  3. Early adoption of trends. Those of you who know me, know I love trends and seeing what’s coming next – that’s part of feeding our strategic brands. But what Bezos talks about is not resisting change and eagerly trying out new things. You don’t need to be the first, you don’t need to be on the bleeding edge of innovation, but you need to do enough to continually adopt change, embrace it and be part of it. 
  4. High-velocity decision making. Bezos talks about how, as companies get bigger, with more stakeholders, it’s easy to get lost in debates while trying to make the right decision – or the perfect decision. This fits into what Jim Collins calls “bullets versus cannibals.” Let’s do bullets and tests and keep moving versus waiting for the one big move – or moving too quickly on the one big move. But he asks, “How quickly are we making the important decisions?” 

In another article Bezos talks about type A and type B decisions:

  • Type A is a two-way door. You can make the decision and you can back out of it. With that, you should decide very quickly because it’s easy to reverse.
  • Type B is a one-way door. You sign a massive contract for 10 years or make a big, long-term commitment – and that needs rigorous debate and more information.

Many companies make type B decisions, using a hardy decision process to answer a simple question, or they’ll use late decision-making for a hardy one, and that obviously becomes a problem. The key question is “Are we making our decisions very quickly, so we can move and take care of the customer?”

Summary

  • Day 1 thinking keeps us fresh, keeps us vibrant, keeps us taking care of our customers, and actually makes your company a more enjoyable place to work because stuff happens.
  • Day 2 is easy to fall into because we get comfortable, and that’s extremely risky. Never mind the fact that it’s not rewarding.