Jeff Bezos, the founder and executive chairman of Amazon and Blue Origin, a space company aimed to service public spaceflight, is one of the most innovative business leaders in the world. His success in the e-commerce industry with Amazon has many business leaders striving to replicate his strategies. And given Bezos currently sits at a net worth of $194 billion — one cannot argue the fact that Bezos has strong principles others can learn from.
There are endless leadership lessons that young business leaders can learn from Jeff Bezos. The leadership strategies, style, and philosophies Bezos possesses are the distinguishing characteristics that have granted him the title of the World’s Richest Man.
But how did he do it, and what can growing business leaders and aspiring entrepreneurs learn from him?
Who is Jeff Bezos?
Recognized as the pioneer of e-commerce, Jeff Bezos’ success began when he launched Amazon, an online retail store. Beforehand, Bezos graduated from Princeton University with degrees in Electrical Engineering and Computer Science. He went on to acquire one of his first jobs at an investment firm, D.E. Shaw & Company. During his tenure at the investment firm, he made history by becoming the firm’s youngest senior vice president in 1990.
Despite his tremendous success at D.E. Shaw & Company, Bezos had a strong entrepreneurial desire to bring what he thought was an innovative idea to life: sell books online. Once, he shared in an interview that when he shared his business idea with his boss at his investment firm, his boss told him that “it seemed like a great idea for someone who didn’t have a great job already.”
Regardless of the risks it entailed, Bezos launched Amazon in 1994. He founded it based on a single statistic: that internet usage would go up by 2,300 percent every year. Bezos had no credible investors when he first ideated Amazon. The only start-up funds he had were that of his own and his parents’ life savings.
During an interview with the Academy of Achievement, Bezos stated, “My dad’s first question was, ‘What’s the internet?’ Okay. So he wasn’t making a bet on this company or this concept. He was making a bet on his son, as was my mother. So, I told them that I thought there was a 70 percent chance that they would lose their whole investment, which was a few hundred thousand dollars, and they did it anyway.”
Today, Amazon is one of the top valued companies in the world. In 2018, the company had a market value of $1 trillion, ranking as the second-highest market valuation in the world, just behind Apple.
Rewinding to 2000, Bezos launched Blue Origin, an aerospace company with the mission of tap space’s unlimited resources to help preserve Earth. At the heart of Blue Origin’s mission lies Bezos’ vision to “expand, explore, find new energy and material resources, and move industries that stress Earth into space.”
On July 20th, 2021, Bezos and three private citizens became the first humans to commercially fly into space and safely land back on Earth. Blue Origin expects to fly two more crewed flights in 2021, with many more flights planned in 2022.
As an innovative entrepreneur, media proprietor, and space traveler, Jeff Bezos’ career has shown what a simple business idea born out of a home garage can bloom into. Bezos’ drive and tenacity is an inspiration to many aspiring business leaders — and at 57 years old, he’s still focused on solving global problems with long-term thinking.
What is Jeff Bezos’ Leadership Style?
Without question, Jeff Bezos stands as a beacon of modern leadership. He was able to transform his startup company into a billion-dollar household name. Though such accomplishment was a collective effort with employees, partner executives, and thousands of employees, Bezos can be credited as the leader of the pack.
Jeff Bezos is widely recognized as a transformational leader — someone who motivates and inspires team members to achieve more than they thought possible. Bezos ensures that everyone on his team is committed to the vision for the organization.
Amazon’s vision, to be Earth’s most customer-centric company, is constantly being communicated by Bezos to hammer the message home. If you’re on team Amazon, you know the customer always comes first. This mindset is a Bezos-born manifestation.
In a letter to Amazon shareholders, Bezos wrote, “I constantly remind our employees to be afraid, to wake up every morning terrified. Not of our competition, but of our customers. Our customers have made our business what it is, they are the ones with whom we have a relationship, and they are the ones to whom we owe a great obligation.”
What are Jeff Bezos’ Leadership Principles?
Along with his creativity and innovative spirit, Jeff Bezos’ leadership style helps him challenge ideas and forge new approaches, navigate potential obstacles, and develop smart solutions. Below are a couple of Jeff Bezos’ leadership principles that he exemplified throughout his tenure as CEO of Amazon.
Embrace Failure
Despite the disappointment and feelings of defeat that typically come with failure, Jeff Bezos has a fresh perspective on accepting, normalizing, and embracing it.
In a letter to Amazon shareholders, Bezos asserted that “One area where I think we are especially distinctive is failure. I believe we are the best place in the world to fail (we have plenty of practice!), and failure and invention are inseparable twins. To invent you have to experiment, and if you know in advance that it’s going to work, it’s not an experiment.”
In the same letter, Bezos explains Amazon’s innovative approach through a baseball analogy, “We all know that if you swing for the fences, you’re going to strike out a lot, but you’re also going to hit some home runs.” From Bezos’ perspective, a business has to embrace the entire process of success and failure, as the two go hand in hand. Plus, they usually require leaders to take leaps of faith. But once a business wins big, the success pays for all the failures that were experienced beforehand.
While Jeff Bezos has had an enormous amount of success with his innovative ideas, he has also experienced failures and setbacks during his inventions.
The Amazon Fire Phone is one example of this. Introduced in 2014, the Fire Phone was marketed as a 3D-enabled smartphone. Reviewers of the device were not fans of what many called gimmicky features. This includes the phone’s dynamic perspective, which was described as worthless and distracting. People were also not impressed by the bland, industrial design and disappointing ecosystem. Ultimately, the Fire Phone wasn’t able to live up to Apple’s library of apps and cohesion.
Customer Always Comes First
Jeff Bezos knew since the launch of Amazon that he wanted it to be all about the customer. Customer centricity is a business strategy that primarily focuses on the customer’s experiences with the brand. The goal is to build strong customer loyalty and increase repeat business.
During Amazon’s first year of business, Bezos and his team focused on generating customer reviews and ensuring that customers were receiving order confirmations. At the time, these features were unheard of in the e-commerce industry.
Amazon’s dedication to its customers throughout the years has led the online retail company to be at the top of customer satisfaction ratings. According to the University of Michigan and its customer satisfaction index, Amazon ranked at the top among 225 other corporations.
As Amazon continues to expand, Bezos’ keeps emphasizing customer obsession — one of the 16 Leadership Principles at Amazon. At the start of every project in Amazon, the team’s first initial step is to start with the customer. The first five questions that managers must answer before beginning the project are:
- Who is the customer?
- What is the customer problem or opportunity?
- What is the most important customer benefit?
- How do you know what customers need or want?
- What does the customer experience look like?
Putting customers first was a strategy Bezos’ coined as Working Backwards. This method can be described as identifying a customer’s need, want, or problem and providing a solution through service, product, or experience. Bezos is a strong believer in customer-centricity because ultimately, what’s best for the customer is best for the business.
How Amazon Completely Disrupted Industries Under Jeff Bezos’ Leadership
Not only did Jeff Bezos change the way business is conducted by serving the customer to the fullest. He was also instrumental in creating new products that completely disrupted their respective industries.
For example, the Kindle completely changed the publishing world. In 2007, the Kindle was introduced as an e-reader. Amazon claims that after five hours, the initial run of Kindle was sold out.
Amazon’s Kindle started the catalyst of eBooks and increased the number of eBooks downloads over the next few years. While there was concern that these e-readers would eliminate print books, the growth of Kindle sales has leveled out in the last few years, with eBooks making up 20 percent of books sales.
Another great example of Bezos’ innovative inventions is the Amazon Alexa device. These home-based products brought a new-age virtual assistant technology that had only been dreamed of in movies before they were released in 2013. It also revolutionized the e-commerce space by allowing customers to simply speak out loud to order products from Amazon, and have them quickly delivered to their door via Amazon Prime.
Of course, almost everyone is familiar with Amazon Prime, another incredible concept from Bezos that completely changed the e-commerce world. Having the ability to order and receive a package within 48 hours has impacted businesses of all sizes. Now, larger corporations like Walmart, Target, and others are still working to meet the deadline expectations that Bezos and Amazon have established as standard practices.
To complement the idea of Amazon Prime’s speed and convenience, Bezos also introduced the Amazon Go Stores. These shops can be found around the world in larger cities. As you enter the brick-and-mortar location, you scan your Amazon account. As you shop, the items placed in your cart are instantly scanned and added to your Amazon account. To check out, you simply walk out the door and your credit card is billed. It has totally revolutionized the traditional convenience store, and essentially eliminated the need for full-time staff on site.
In the digital world, Amazon Web Services (AWS) has changed website building and cloud services. AWS provides on-demand cloud computing platforms and APIs on a metered pay-as-you-go basis. AWS is considered one of the most user-friendly hosting platforms on the market. Now businesses no longer need to invest in large IT server rooms and their maintenance. Instead, they’re able to instantly access large amounts of data at scale through the cloud.
The work Bezos has done has had a lasting impact on the industries he’s involved with. His impact on the e-commerce, publishing, and web hosting industries will last for years to come. With his continuous drive to keep innovating, there are sure to be more industry-changing inventions from Bezos.
What Can Leaders Learn from Jeff Bezos?
Jeff Bezos’ leadership style has extraordinary takeaways. Learning and applying the mentality he possesses can be extremely beneficial for aspiring entrepreneurs and business leaders. It’s not easy for companies and their leaders to experience consistent growth while keeping a competitive edge. However, with the right mentality, as Bezos’ story proves, a business leader can lead their team to victory despite future challenges.
Amazon’s foundation for success tenaciously focuses on three pillars:
- Customer satisfaction
- Creating long-term value over short-term corporate gains
- Betting against extreme business odds
Bezos expected to achieve this by having a Day 1 mentality. The Day 1 mentality asks employees to:
- Obsess over customers
- Make high quality, high-velocity decisions
- Embrace external trends and resist proxies
- Embrace failure
- Generate nimble organizational structures
- Strengthen small teams through ownership and accountability
- Prioritize long-term and sustained value
By imbuing the Day 1 mentality into the company culture, Bezos hammers his idealism home. Empowering the people involved with the company ensures the business leads with innovation and authentic passion at the forefront.
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