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Worldcrunch

"It's Day One"- Jeff Bezos Takes Stock

In a sit-down with France's top business daily Les Echos, Amazon founder Bezos reflects on the pure speed of innovation on the Internet, and why the “posture” of consumption can change everything.

Article illustrative image Partner logo He knows something that we don't (jurvetson)

SEATTLE - In a rich and wide-ranging conversation with the digital editor-in-chief of France's leading business daily Les Echos, Amazon founder Jeff Bezos, 47, reflects on the lightening fast evolution of the Internet, and his company's ability to compete in everything from e-commerce to media to cloud computing. And his plans for the future: trying to figure out what big things are going to change -- and what won't.

People in the U.S. now spend more time on mobile apps than on the Web. How far do you think we are in the digital revolution? Somewhere in the middle?
I doubt it. We’re just at the beginning. Day One. Don’t you think?

I don’t know. You’re the expert.
I think so. With new technologies, it’s very tempting to think that you’re further along than you are. But usually, you’re more primitive than you think. My guess is we’re still pretty primitive. We as a society, as a civilization. I doubt we have figured out the new technologies very well yet. 

And as Amazon, where are you ?
We’re the same. We’re part of that civilization (laughs). We’re doing our part in trying to push things forward, but I have the feeling it’s Day One. 

What has been the most stunning change since you founded Amazon in 1995?
The most amazing change… Looking at over 15 years, the most stunning is the pace at which the Internet has developed. In 1995, I had to raise a million dollars from 22 angel investors who invested around $50,000 each to fund Amazon, and the question all those investors had was “what’s the Internet ?” That was just 16 years ago… It’s been such an extraordinary change, we’ve never seen a change that rapid. Go back and look at other major technological changes, jet travel, the automobile, radio, television, the telephone: you can look at their growth rate, and nothing has ever swept in as quickly and as globally as the Internet. If you want something that qualifies as stunning, that’s probably a first in the history of civilization.

And what will be the next stunning change in the digital world ?
That is difficult question. I spend most of my time trying to find what the Internet is not going to change… Because we can build business plans on things that are stable, but it’s harder to build a business plan on something that is going to change rapidly. But if I stay focused on your question and say what’s going change over the next 10 years, it’s probably mobile technology, wireless technology. These smart phones and tablets that we have today are going to become increasingly sophisticated. 

Does it worry you?
No. It delights me ! (laughs) It’s great for retail business. Historically, our business has been built on top of people buying from their desktop computer and their laptop computer, which you can only use in a couple of postures. And the tablets and the smartphones open up a completely new posture. The tablet for example means you can lay back on your sofa and shop on Amazon. I love that and I encourage you to do it ! (laughs)

Today, Amazon is retailing, and merchant, and cloud, and Kindle, and food, and Amazon studios… Are you a specialist of anything ?
At the broadest level, I think there are three things that define Amazon, and they are cultural attributes more than business areas. One is customer obsession, as opposed to competitor obsession. A lot of companies have been successful on focusing on their competitors, but that’s not our way. Second, is willingness to think long-term and third is willingness to invent, which includes the willingness to be misunderstood, otherwise you can’t invent.

Inside that framework, we’re willing to learn new skills. So there is a tension between willingness to learn these new skills and deciding that you’re an expert in something that you’re gonna stay focused on. 

Amazon Web services or Kindle are both good examples. They require us to learn new skills when some companies would say that you should stay focused on what you’re good at. What that really says is “don’t learn new skills” or only learn incremental new skills. Don’t ever try to learn something new!
When we did Kindle, I’m going back seven years now, we had to learn how to design hardware, how to manage a supply chain for hardware. A bunch of new skills. Now we’re going to hire sophisticated people, but still, we need to learn new skills institutionally as well, and so we’re bringing that skills set into practice. I think it’s essential for companies to be incremental learners, but also to be willing every once in a while to pick up a whole new skill set that you weren’t previously focused on.

You mentioned being misunderstood. Have you been misunderstood ?
Yes it’s normal.

Have you ever had doubts?
Everything important we’ve ever done had some level of misunderstanding. And there are at least two kinds of critics. There are people who sincerely misunderstand and they want everything to work out well but they’re worried about it. And there’s a second kind of critic who has a self-interest to misunderstand…If you’re gonna do something new, something that has never been done before, people are going to misunderstand for one of those two reasons. And what you need to do when you hear that kind of criticism is first to open your mind and say “Are they right? Are we doing something wrong? Are we make a mistake for some reason?”. And if it the case, change your course. But if you look at it and you still have the conviction that your new way is worth pursuing, then you have to ignore those critics, otherwise you can’t do anything new.

Have you ever changed a major decision ?
We have. We’ve given up on projects that have failed. Many times. We have to stay stubborn on the vision but we can change on the details. Our third-party seller business is like that: we launched Amazon Auctions, and many people criticized it, and they turned out to be right… (laughs) ; and then we launched The Shop, and many people criticized it, they were right, it didn’t work ; and then we launched Market Place, which has become Merchant Sellers, and that was a big success. That’s an example of staying very stubborn on the vision when underneath, all the executional details got changed twice. 

In terms of Amazon categories, what are the next ones you’re dreaming of?
In most of the categories, the most we’re doing is adding depth. We’re in most of the major categories already and we’ll continue to roll things out. Our focused areas are on electronics, apparels, some consumable items. And in media, we really focus on digital, and that’s true for books but also for video, music, audio books, video games... So we sort of have our media business undergoing a digital transformation that we’re working very hard on. In our physical products business, there are still so much opportunities to continue to add selection inside existing categories. 

Food, cloud and Kindle… How would you rate those three areas ?
(Laugh). Wow. I don’t know if I could do that! But it reminds me of that famous quote : if I have a little money, I’ll buy books. If there’s any left over, I’ll buy food (laugh). But I don’t think I could rate those things for you. I apologize…

Do you want to become the king of Cloud ?
Amazon Web services is operating in this new arena that is so big that there are going to be multiple winners. And I believe our team had done such a good job that they are likely to be the leader in that arena, and certainly I hope that they will be one of the major leaders. 

How will you achieve that?
The big success drivers in our business are innovation, operation excellence, and cost structure. So we’re constantly driving new services that developers can use, that’s the innovation piece. Operational excellence is making sure that the services are highly available, minimizing any downtime. We want our system to be operationally and statistically indistinguishable from perfect. And then becoming efficient so that we can continue to drive the cost structure down and offer these Web services at very good prices. That’s our approach. 

Amazon has now 38000 employees. Has it changed your approach of management and the corporate culture?
The key points for corporate culture are customer obsession, willingness to invent and long term orientation. Those three things have not changed. I do worry, because other companies changed their culture when they got big. If we look out at the future, I don’t what that to happen, and I like the culture that we have. I like the internal dynamics at Amazon: people are energetic around debate and controversy, and they’re candid with one another. In some other large companies, I’ve observed that people sometimes sort of optimized for social cohesion instead of truth seeking. And I want us to avoid that change. It’s a sort of mantra that I repeat over and over, because it takes energy to seek the truth. It’s easier to just get along… (laugh). 

What were the last threes things you bought on Amazon ?
I bought soccer cleats, a science fiction novel on my Kindle called “Robopocalypse”, and a video episode of “The new adventures of Old Christine”. That was just last night.

Read the original article in French

photo - jurvetson 

 

 

 

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About this article source Website: http://www.lesechos.fr/

France's top business daily, Les Echos covers domestic and international economic, financial and markets news. Founded in 1908, the newspaper has been the property of French luxury good conglomerate LVMH (Moet Hennessy - Louis Vuitton) since 2007.

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