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The MHC Blog

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Recently Amazon founder Jeff Bezos published his annual letter to shareholders.  After commending Amazon employees for their commitment to excellence and Amazon customers for pushing him and his team to continue raising the bar, he delivered a lesson in how to stay ahead of customer expectations. 

It all comes down to maintaining high standards. 

In fact, Jeff seems obsessed with high standards, reading his memo in full, he repeats this phrase so many times I lost count!  But you cannot argue with facts.  As Jeff states:

“The American Customer Satisfaction Index recently announced the results of its annual survey, and for the 8th year in a row customers ranked Amazon #1. The UK have a similar index, The U.K. Customer Satisfaction Index, put out by the Institute of Customer Service, for the 5th time in a row Amazon U.K. ranked #1 in that survey.

Amazon was also just named the #1 business on LinkedIn’s 2018 Top Companies list, which ranks the most sought after places to work for professionals in the US. And just a few weeks ago, Harris Poll released its annual Reputation Quotient, which surveys over 25,000 consumers on a broad range of topics from workplace environment to social responsibility to products and services, and for the 3rd year in a row Amazon ranked #1.”

Results to be proud of, but how does Amazon do this?

 The Shareholder memo is very long and comprehensive and can be found here https://bit.ly/2qGKiOl.  One of the interesting aspects of the memo is the way that Jeff runs his Senior Team (STEAM) meetings. PowerPoint presentations were banned in 2004.  Each meeting starts with a six-page narrative memo which the executives read and absorb for up to 30 minutes before the conversation starts.  And here, high standards are expected and required.

As Jeff puts it “We don’t do PowerPoint (or any other slide-oriented) presentations at Amazon. Instead, we write narratively structured six-page memos. We silently read one at the beginning of each meeting in a kind of “study hall.” Not surprisingly, the quality of these memos varies widely. Some have the clarity of angels singing. They are brilliant and thoughtful and set up the meeting for high-quality discussion. Sometimes they come in at the other end of the spectrum.”

He says the “difference between a great memo and an average one is much squishier. It would be extremely hard to write down the detailed requirements that make up a great memo. Nevertheless, I find that much of the time, readers react to great memos very similarly. They know it when they see it. The standard is there, and it is real, even if it’s not easily describable.”

Amazon seems to have taken a page out of Winston Churchill book, the Amazon’s founder and the UK’s wartime prime minister have agreed on the “value of a good memorandum”.

The principle at Amazon is that an executive must refine his or her proposal so fully to express it in narrative form that everyone will be able to understand it. Reading the memo means that all those in the room are informed for the conversation that follows and are not merely bluffing. 

The narrative provides background, facts in an Appendix, they can be written as a story and can take many days and weeks to prepare. “Often, when a memo isn’t great, it’s not the writer’s inability to recognise the high standard, but instead a wrong expectation on scope: they mistakenly believe a high-standards, six-page memo can be written in one or two days or even a few hours, when really it might take a week or more! …. great memos are written and re-written, shared with colleagues who are asked to improve the work, set aside for a couple of days, and then edited again with a fresh mind. They simply can’t be done in a day or two….. a great memo probably should take a week or more.”

Without the narrative, you just get a series of disconnected facts and opinions. Collectively, it won’t make sense.

Churchill would have agreed with this line of thought, he said in 1940 “To do our work, we all have to read a mass of papers. Nearly all of them are far too long.  The discipline of setting out the real points concisely will prove an aid to clearer thinking.” 

Another Innovative entrepreneur appears to also look to Churchill for inspiration. Elon Musk, CEO of SpaceX, Tesla Inc and Neuralink requested in an email to his Tesla employees -   "Don't use acronyms or nonsense words for objects, software, or processes at Tesla. In general, anything that requires an explanation inhibits communication. We don't want people to have to memorize a glossary just to function at Tesla." 

Churchill also had a dislike of jargon “Let us not shrink from using the short expressive phrase, even if it is conversational,” he instructed his civil servants, warning them that “most of these woolly phrases are mere padding, which can be left out altogether”.

In essence, high standards take time, there are no short cuts in business and being fully informed and aware reaps the rewards in the long term. 

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Claire Donnelly

Written by Claire Donnelly

A Business Growth and HR Strategist helping medium size companies to Scale Up using proven systems. Claire is an MCIPD qualified Human Resource professional, with 25+ years’ experience working within various industries and 10 + years’ experience of HR practices throughout the Middle East. As a HR Generalist she has held a number of senior and Board level HR positions. She is experienced in working at both strategic and tactical levels.

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