Amazon is now regarded as the best company in the world – its market capitalisation is approaching R800 billion and its founder Jeff Bezos is the world’s richest man.
Year after year in customer satisfaction surveys Amazon invariably comes out on top. Jeff Bezos recently shared Amazon’s secrets in his annual letter to shareholders.
The key to this success is that high standards are now part of the culture of Amazon. How was this achieved?
The key principles
Standards are teachable
High standards are not part of our DNA but anybody willing to learn can absorb the requirements of high standards. This is refreshing in an era where many organisations are recruiting only well qualified people.
Once the ethos of high standards is taught and accepted it becomes infectious and spreads to the whole team and the organisation. Conversely, the opposite is true that low standards are also infectious.
Standards need to be high across all disciplines
Your business will not be successful unless all disciplines achieve high standards. If, for example, you have great marketing and production capabilities but poor distribution and sales staff the business will struggle to be competitive.
Bezos says all people have blind spots and cannot set high standards in all areas. But if you build up a strong management team which covers all spheres of the business, you will achieve best practice methodologies across the company.
Be realistic
Communicate to your staff that attaining world class standards involves hard work. It is not going to be easy but if there is a culture of team members striving to achieve these standards, then it will filter down to all employees.
Skills and teamwork
No individual has all the skills required to complete all functions in their team activities. But working in teams most often means that one team member will have a unique, necessary skill needed by the team. In other words, having a pool of skills in a team increases the overall skill levels of the team.
Work in narratives
Most surprising is that Amazon doesn’t work in PowerPoint presentations but in six page memos. At the beginning of each meeting one team will present a six page memo. The meeting will spend half an hour reading and discussing the memo.
This has many benefits – the team writing the memo spends time getting their thoughts and ideas into a well-constructed narrative format. As Bezos writes, you cannot lay down procedures on how to write a good memo but everyone recognises a good memo when they see it.
The power of this is that everyone in the team discusses and understands these memos. In turn it is well communicated to the organisation and thus builds up Amazon’s high standards.
Not everyone can write a high quality memo, but there is always someone in the team who can and if each team member contributes to it, then the team as a unit will have the skills to write a high quality memo.
Bezos says we need to accept that a high quality memo usually cannot be written in a couple of weeks – Amazon’s best memos are often written and rewritten over a few months until they achieve the high standard and clarity required. This needs to be communicated to the organisation, otherwise teams will quit if they can’t write a good memo in a week or two. As Bezos writes above, be realistic.
High Standards equate to a successful business
Once you have achieved this across the organisation, your business will have world class products/services, people and processes. In a world of fast moving consumer expectations and rapid change, building a strong organisation with high standards is critical to staying competitive.
You also find that high calibre people are drawn to companies like Amazon. This reinforces the success of the company and enables it to keep pulling away from the competition. We live in a dynamic world so we need to keep growing our knowledge and skills.
Some of us may not like the idea of using memos to build standards but good leadership, fostering a culture of learning (standards are learnt), quality in all aspects of the business and encouraging teamwork will put your business on the path of success.
Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.
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