The Everything Store: Jeff Bezos and the Age of Amazon By Brad Stone Hachette Publishing, 2013
In a 2013 interview, Charlie Rose asked Amazon’s founder, Jeff Bezos, to define his company. “I would define Amazon,” he replied, “by our big ideas, which are customer centricity, putting the customer at the center of everything we do, and invention.” The Everything Store traces the story of how those ideas — which have been at the core of Mr. Bezos’s vision for Amazon — created one of the great entrepreneurial success stories of our time and transformed the way we shop.
But customer-centricity isn’t the only value that has led to Amazon’s success. Ruthless execution — another central value, and one that the book doesn’t shirk from describing — has allowed Amazon to move faster, smarter, and more aggressively than its competitors. The company’s ability to move quickly has allowed it to exploit strategic advantages it gained due to thinking long-term, another central value.
Alas, Amazon’s relentless pursuit of customer satisfaction has often come at the expense of other actors in the ecosystem, especially employees and vendors. The company’s negotiators don’t aim for win-win, and work-life balance is anathema. The book describes a demanding environment that selects for a particular type of employee, one that’s fully committed to — and willing to make personal sacrifices for — the company:
The people who do well at Amazon are often those who thrive in an adversarial atmosphere with almost constant friction. Bezos abhors what he calls “social cohesion,” the natural impulse to seek consensus. He’d rather his minions battled it out in arguments backed by numbers and passion, and he has codified this approach in one of Amazon’s fourteen leadership principles—the company’s highly prized values that are often discussed and inculcated into new hires.
The book also traces Amazon’s emergence from an underdog in the online book sales market to one of the most powerful forces in several industries. Along the way, the company disrupted long-established business models (for example, causing the publishing industry to shift to an agency model.) Through technological disruption, frugality (yet another key value), and liberal use of its market leverage, Amazon lowered retail prices in several verticals, much like Walmart — its spiritual predecessor – did. Lower prices, in turn, gave it even more clout in the market. These changes have often come at the expense not just of competitors, but also of partners and providers. That said, given the changes wrought by digital technologies, these industries would’ve transformed sooner or later. In many cases, Amazon accelerated the inevitable.
But to think that the company’s success is due to “digital transformation” of industries is to miss the point. One of the book’s central insights is that while Amazon is a purveyor of goods and services, at its essence, it’s also a provider of information. As I’ve written before, for Amazon, a central aspect of being customer-centric is giving customers the information they need to decide about a purchase, even if this means forgoing a sale in the short-term. This is a major mindset shift for retailers, and one that other industries should emulate in our digitally connected world.
Amazon’s story is a key case study, not just for digital entrepreneurs and managers, but for anyone working in business today. It’s an excellent illustration of how to exploit technological changes strategically to gain power and influence and thereby transform markets. This engaging book presents a balanced portrait of Amazon as a major force for change, and of Jeff Bezos — its prime mover.
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