This is not new. It has been reported on before. But I just finished reading this article about Jeff Bezos’ relentless commitment to “high-quality and high-velocity decision making” at Amazon.
Here are a couple of high level points:
- There are decisions that cannot be easily reversed (Type 1) and there are decisions that can be (Type 2). Knowing which is which is important. To help get better at this, they are very diligent about tracking the outcomes of previous decisions.
- Make decisions without all of the info you wish you had, because if you don’t, you’re probably moving too slow. Speed is paramount. If you’ve categorized your decisions properly (see above), being wrong may not actually be that costly.
- There’s a company philosophy centered around “disagree and commit.” It is about moving forward – since speed is so important – without full consensus. In other words: We may not all agree, but can we disagree and commit to this?
Perhaps the most interesting, and seemingly paradoxical, aspect of Amazon’s “high-velocity decision making process” is that it is built upon narrative memos, instead of PowerPoint decks. In fact, decks have been
This is not new. It has been reported on before. But I just finished reading this article about Jeff Bezos’ relentless commitment to “high-quality and high-velocity decision making” at Amazon.
Here are a couple of high level points:
- There are decisions that cannot be easily reversed (Type 1) and there are decisions that can be (Type 2). Knowing which is which is important. To help get better at this, they are very diligent about tracking the outcomes of previous decisions.
- Make decisions without all of the info you wish you had, because if you don’t, you’re probably moving too slow. Speed is paramount. If you’ve categorized your decisions properly (see above), being wrong may not actually be that costly.
- There’s a company philosophy centered around “disagree and commit.” It is about moving forward – since speed is so important – without full consensus. In other words: We may not all agree, but can we disagree and commit to this?
Perhaps the most interesting, and seemingly paradoxical, aspect of Amazon’s “high-velocity decision making process” is that it is built upon narrative memos, instead of PowerPoint decks. In fact, decks have been
banned at the company since 2004
.
The reason for this is that narrative memos are more difficult to write, which means you really have to understand what you’re talking about. It encourages deeper thought and it allows nuances and interdependencies to come through.
Apparently important meetings start with everyone just sitting in a room reading the narrative memo, which are often between 4-6 pages. Once everyone has read the memo and is on the same page, the meeting starts.
As someone who writes a daily narrative, this approach really resonates me. It would be a hell of a lot easier if I could just show up here every day and throw down a few bullet points. But then both of us would get far less out of this practice.
Writing takes time. Bezos has acknowledged that these memos cannot be written in a day or two. But clearly there’s a belief that more time spent up front translates into greater overall speed. Their market cap suggests that is working.
At the beginning of this month, Interbrand released its annual ranking of the world’s best global brands. This year’s 2018 report marks the 19th year of the study. If you’d like to download a free copy of the report, you can do that here. But below is a snapshot of the first 24 brands:
Apple and Google are in top position for the 6th year in a row. And Amazon is on a hockey stick trajectory with its brand value jumping by 56%. More than half of the list is comprised of the following five sectors: Automotive (16), Technology (13), Financial Services (12), Luxury (9), and Fast-Moving Consumer Goods (9). Luxury is currently the fastest growing sector.
I just finished listening to this podcast about venture capital and consumer products. One of the underlying questions is whether we are currently in a “consumer downturn.” Rebecca Kaden of Union Square Ventures (USV) talks about the importance of “platform shifts” for venture returns. These are moments where a new technology hits the marketplace and there’s a corresponding mass consumer adoption. When and where will that next shift occur? Maybe it’ll be in real estate.
I like the discussions at 10:00 and 13:50. The first deals with the importance of non-paid customer acquisition strategies for consumer products. Rather than relying on bought attention, you really need organic growth strategies, which is often an indication that people are passionate about your product. This is arguably more important when you’re fundamentally reliant on massive growth/scale, but whether we’re talking about software or a home, I still believe it’s paramount. Create things people love.
The second point is about commerce, Amazon, and how USV avoids investing in companies that are unlikely to ever win against Bezos. Kaden’s position is that Amazon’s advantage is and has been more executional than structural. They are simply really good at doing things better. But Amazon wins at logistics, speed, and value. They are not as focused on experience, entertainment, and discovery. And people still want that.
I’ll stop there. If you can’t see the podcast below, click here.
The reason for this is that narrative memos are more difficult to write, which means you really have to understand what you’re talking about. It encourages deeper thought and it allows nuances and interdependencies to come through.
Apparently important meetings start with everyone just sitting in a room reading the narrative memo, which are often between 4-6 pages. Once everyone has read the memo and is on the same page, the meeting starts.
As someone who writes a daily narrative, this approach really resonates me. It would be a hell of a lot easier if I could just show up here every day and throw down a few bullet points. But then both of us would get far less out of this practice.
Writing takes time. Bezos has acknowledged that these memos cannot be written in a day or two. But clearly there’s a belief that more time spent up front translates into greater overall speed. Their market cap suggests that is working.
At the beginning of this month, Interbrand released its annual ranking of the world’s best global brands. This year’s 2018 report marks the 19th year of the study. If you’d like to download a free copy of the report, you can do that here. But below is a snapshot of the first 24 brands:
Apple and Google are in top position for the 6th year in a row. And Amazon is on a hockey stick trajectory with its brand value jumping by 56%. More than half of the list is comprised of the following five sectors: Automotive (16), Technology (13), Financial Services (12), Luxury (9), and Fast-Moving Consumer Goods (9). Luxury is currently the fastest growing sector.
I just finished listening to this podcast about venture capital and consumer products. One of the underlying questions is whether we are currently in a “consumer downturn.” Rebecca Kaden of Union Square Ventures (USV) talks about the importance of “platform shifts” for venture returns. These are moments where a new technology hits the marketplace and there’s a corresponding mass consumer adoption. When and where will that next shift occur? Maybe it’ll be in real estate.
I like the discussions at 10:00 and 13:50. The first deals with the importance of non-paid customer acquisition strategies for consumer products. Rather than relying on bought attention, you really need organic growth strategies, which is often an indication that people are passionate about your product. This is arguably more important when you’re fundamentally reliant on massive growth/scale, but whether we’re talking about software or a home, I still believe it’s paramount. Create things people love.
The second point is about commerce, Amazon, and how USV avoids investing in companies that are unlikely to ever win against Bezos. Kaden’s position is that Amazon’s advantage is and has been more executional than structural. They are simply really good at doing things better. But Amazon wins at logistics, speed, and value. They are not as focused on experience, entertainment, and discovery. And people still want that.
I’ll stop there. If you can’t see the podcast below, click here.
In their report, they outline five themes that have emerged and that are helping these brands outperform. They are:
Positive utility - not enough to just make people feel good through storytelling; you need to create real value and a positive impact in the world
Subscription mindset - there’s an increasing amount of brand value in subscription-based businesses (29% in 2018 compared to 18% in 2009); you need to offer your products and services with the least amount of friction as possible
Customer-centricity - bring the voice of your customer into every aspect of your business; be nimble enough to respond quickly
Learning from luxury - the top performing category in this year’s ranking; about exclusivity and authenticity
Role of brand - make your brand part of the decision-making process; build brand equity and trust
I’ll stop there and let you all dig into the rest of the report if you’re interested.
But one thing I found particularly interesting about the study is that they used – insert buzzwords here – “AI-powered social listening” to try and measure the emotion and sentiment floating around on the internet around specific brands. The goal was to pin down the perceived trustworthiness of specific brands.
In their report, they outline five themes that have emerged and that are helping these brands outperform. They are:
Positive utility - not enough to just make people feel good through storytelling; you need to create real value and a positive impact in the world
Subscription mindset - there’s an increasing amount of brand value in subscription-based businesses (29% in 2018 compared to 18% in 2009); you need to offer your products and services with the least amount of friction as possible
Customer-centricity - bring the voice of your customer into every aspect of your business; be nimble enough to respond quickly
Learning from luxury - the top performing category in this year’s ranking; about exclusivity and authenticity
Role of brand - make your brand part of the decision-making process; build brand equity and trust
I’ll stop there and let you all dig into the rest of the report if you’re interested.
But one thing I found particularly interesting about the study is that they used – insert buzzwords here – “AI-powered social listening” to try and measure the emotion and sentiment floating around on the internet around specific brands. The goal was to pin down the perceived trustworthiness of specific brands.
