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What Legacy Companies Can Learn from Amazon’s Culture

What Legacy Companies Can Learn from Amazon’s Culture

November 19, 2018

There’s a lot of buzz surrounding Amazon’s culture. You’ve probably heard rumors about the intensity of the workload, the cut-throat atmosphere or the unrealistic expectations. While working at Amazon has its challenges (and I should know - I worked there for five years), there is an enormous upside that any legacy company can learn from: Amazon empowers its employees to drive change.  

This culture of empowerment and innovation is actually a bigger driver of Amazon’s success than its technology. Lots of legacy companies struggle to recruit and retain top young talent because they stifle ideas and are slow to adapt. They base decisions on opinions and experience and hold onto their institutionalized ideas and processes because that’s what they know, and “that’s how it’s always been done.” For ambitious, energetic and creative employees, this is a dead-end and will cause them to move on to industries and companies that are more ready and willing to change.

Operationalizing Culture

At Amazon, culture is more than just a set of posters on a wall. Employees benefit from a clearly defined, shared mission: “To be Earth’s most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online.”More significantly, Amazon has taken that shared mission and broken it down into leadership principles that guide their everyday conversations, decisions and interactions.

By operationalizing this culture of empowerment and innovation, baking it into everyday processes, employees throughout the company (not just the top-level executives) have equal stake in Amazon’s success. Amazon’s culture serves as a barrier-breaker, ensuring that all ideas are considered no matter their origin and prohibiting executives from being overly dismissive of new or unusual ideas. In fact, there is even a process by which any Amazon employee can take an idea, write up a proposal and, within a very short period of time, get their idea approved. From there, the employee receives the resources and budget and it’s on them to follow through. This means that ideas don’t stagnate or disappear into an administrative black hole.

Furthermore, the integration of Amazon’s leadership principles into daily operations ensures that Amazon’s mission is being considered at all major decision points, and that once a decision is made, people can justify why they made this choice. It establishes a framework for innovation, enabling employees to make quick, data-supported decisions and implement solutions that make their customers’ lives easier. 

Even with all of its advantages, Amazon’s culture isn’t perfect. People move around so quickly within Amazon that they don’t have the time to develop the depth of product knowledge that traditional distributors have. Even more significantly, many people come to Amazon, embrace the culture, learn as much as they can and then use Amazon to launch their own independent careers. So while Amazon’s culture is powerful, it still has its limitations.

So What Does This Mean for Traditional Distributors?

Distributors can draw several important lessons from all this. The first is to make sure that your core values are operationalized. A transparent, clearly communicated and consistent set of values goes a long way in empowering employees to operate within a framework and remain innovative. Empowered employees enable progress, speed up the decision-making process and ultimately develop solutions that simplify your customers’ lives.

The other, and equally significant, lesson is to recognize where Amazon’s culture falls short and to use that shortcoming to differentiate your company.

Ultimately, Amazon’s goal is to make it easy for people to buy products. Their customer experience doesn’t necessarily make it easy for people to find products, especially if you’re searching for a solution to a problem but don’t necessarily know what product you need to solve it. This strategy, combined with the fact that Amazon’s employees are too mobile, means that distributors have a competitive advantage.

By investing in good product data and making it simple for customers to find the right item, distributors can create a much better customer experience than what Amazon is capable of producing. Rather than just becoming a place to buy products, your digital platform should be a place where people come to research and learn how to use products.

When distributors absorb and operationalize aspects of Amazon’s culture - being innovative, empowering employees to implement solutions, thinking about what customers will need down the road - and then apply their decades of product knowledge to create a great user experience, it can be an incredibly powerful strategy to attract and retain customers.

Jason Hein is an e-commerce expert and product strategy leader. He brings over 20 years of industry-leading experience in industrial distribution, including at Amazon Business and McMaster-Carr. At B2X Partners, Jason works to expand content strategy and develop world-class processes for rich product data and optimized product merchandising. Jason will be speaking at the MDM Forum in December.

 

© 2019 Gale Media, Inc.

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