Disruptive Leadership: The Amazon Management System
MANAGEMENT ISN’T WHAT IT USED TO BE. And that just might be the understatement of the century. Every single executive, entrepreneur, manager and employee out there — without exception — must recognize that the century-old traditional management system has become obsolete. Going forward, every organization will be digital. Companies — even entire industries — will be disrupted and destroyed; but at the same time, new market space and enormous economic opportunity is being created.
It takes a new kind of organization to thrive in this environment, and we believe Amazon personifies the new formula for winning in the digital age. Its management system breaks new ground in six key ways:
BUILDING BLOCK 1: A Customer-Obsessed Business Model
Despite their espoused commitment to putting the customer first, most traditional companies tend to be competition-centric. They pay a huge amount of attention to financial results, especially earnings per share, and dance to the quarter-by-quarter short-term rhythm set by the capital market. In contrast, Amazon’s business model is customer-obsessed; continuously expanding; built on novel concepts of platform, ecosystem and infrastructure; and able to defy traditional laws of diminishing returns — all while delivering increasing cash flows and higher return on investment.
BUILDING BLOCK 2: A Continuously Bar-Raising Talent Pool
Most traditional companies spend enormous amounts of money and effort in recruiting, developing, and retaining talent, and yet still encounter huge difficulty in finding the right people and deploying them in the right jobs. Amazon’s talent pool is carefully defined, meticulously documented, and rigorously chosen. This is coupled with complete end-to-end follow-through and feedback to ensure continuous bar-raising, both for the talent pool itself
