Big Ideas from Jeff Bezos

1) Long-term Thinking.
There are projects that you simply cannot complete within the frame of 2-3 years which is a classic span for corporate projects. There are some big bets like Amazon Web Services and Amazon Prime that take much longer than this time horizon. And that’s where long-term thinking could be applied. Just because in the longer time horizon we can do more and better, by thinking long term we unfold a whole new set of opportunities for ourselves. But that requires something - understanding of what we need in the long term.
People always say - how is it possible to plan long term when tomorrow is so uncertain?
That’s true but only as long as we focus on highly flexible variables like our own desires. Yes, today we want Mercedes, tomorrow we want Tesla, day after tomorrow we want Waymo, but the thing is that our needs do not change much. And that’s something related to the next concept of big ideas of any industry. Instead of focusing on variables, it is much better to focus on constants and build the long-term strategy around them.

2) Industry Big Ideas.
The reason why Jeff Bezos repeats the same things over and over again is because they are of paramount importance and actually he thinks of nothing else. Why to be distracted if everything at the end of the day comes back to those paramount fundamentals? And that is so wise because we love to think about complexities, dive deeper into things and forget the most essential fundamental. It takes mental discipline to focus on big things and keep them in vision, instead of chasing something smaller but new and fresh.
In e-commerce the big ideas are: vast selection, fast delivery, low cost structure (which leads to lower prices to the customers). Those are the big values for the customers.
For instance, in education some of the big ideas are: student experience, engaging processes, passionate educational leaders.
It is impossible to think about a day 10, 20, 30 years from now when a student says that they want the lesson to be boring or teacher not to be interested in the subject they are teaching. Those are fundamentals to keep in mind and focus in the long run.

3) Follow your passion.
From the old interview of 1998 Jeff has been saying: “Do something you are very passionate about and don’t chase something called hot passion of the day!”.
And that is so true. He has always been passionate about technology and space. Here we go.
Passion leads us to greater results overtime. We should listen to our hearts because otherwise it will be incredibly hard not to give up. The process should bring us joy and fun, not only results!

4) Customer Obsession over Competitor Obsession.
Your competitors won’t pay you checks, so why should you care about them?
Understand the big ideas for your customers and focus on them, do not distract on side things.
Customer obsession is the ultimate solution because at the end of the day it is the primary source of company’s success from any perspective. The only reason company is alive is a customer. And Jeff has done a truly great job setting the high bar for the whole world in understanding that fundamental principle. Now every single entrepreneur claims that they are customer obsessed - even though it is not totally true but at least now everyone actually cares about the customers not competitors as it was just a few decades ago.

5) Leverage your infrastructure.
Hadn’t there been Personal Computers, Logistics, Electricity and so many more layers before Amazon, the company would not have existed. It is so crucial to understand what kind of giants we are standing on, so that we can leverage it. Jeff was prescient that technology grows, computers grow, computational power grows, the bet on the thing like Internet that is built on top of so many growing infrastructures and one of them is evidently Internet.

6) Experimentation, Invention, and Pioneering.
Only the companies that experiment will be able to survive and enjoy the lasting period of its existence. Scientific approach is essential everywhere: starting from the point of identifying the customers’ needs ending with the solution itself. We need to have assumptions that something could be valuable to customers and then just test it. The experimentation by very nature implies failures and those mistakes should not even be considered as mistakes at all. This is just exploration area that brings key insights. Once some failure is made, the company now knows in what direction to move. The crucial part here is to learn from own mistakes and adapt very quickly. The Amazon’s culture is the one that supports experimentation led mistakes and learning from them.
Apart from Experimentation, Amazon is the company where inventions are fundamental in the process of what they do. They love reinventing the wheel for the sake of creating something completely new, different, and better. That requires empathy for the customer which works very well in Amazon’s culture, obviously!

7) Working Backwards.
Finding the root causes of the problems and working backwards is crucial for fundamental success in any sphere. Starting with the customers’ needs and then moving backwards to the original inputs is so essential to figure out how we can contribute to customer’s success already now. Sometimes we do not know where to start when we see the giant goal. This principle can be highly instrumental - we just start stepping back until we get to the point of high control. This is the point of input identification. We could not be always in control of final output as there are other factors affecting it. But we can know perfectly the whole area of our control and do our job excellently. That is possible only with “working backwards” principle when we get to the root causes of the final stage we need.

8) Two types of decisions.
There are 2 types of decisions: irreversible and reversible. The difference is very simple. If it is highly expensive to return the original status before the decision then it is an irreversible decision. Whereas, if we can make it rather quickly and painlessly - it is reversible decision. The thing is to spend as little time as possible on reversible decisions and as much as possible - on irreversible decisions. It is crucial to differentiate between the two so that reversible could be made by everyone so to focus on the high velocity and irreversible should be made with great precision and care. Measure twice and cut once - great approach for irreversible decisions.

9) Regret minimization framework.
Every time we face some challenge of making the right long-term decision, it is better to use the “Regret minimization framework” designed by Jeff. Project yourself to the age of 80 and ask yourself - will you regret of not taking this action? This is a great tool to get rid of short-term thoughts and other distractions to make a truly right decision for ourselves. As a rule, people regret much more about the acts of omission not emission. Notably, Jeff always knew he would regret if he didn’t pursue the Internet rush. He knew that he could come back to a stable corporate life any time but he would be always regretting not giving it a try. The history shows that it was the right decision to make.

10) Be missionary, not mercenary.
There are different motivations behind people’s desire to start and run a new business. Yet Jeff strongly recommends us to follow our passion and go for the mission instead of being money/profit driven. Missionaries never build companies to sell. They are focused on some bigger impact on the world. Those are the companies that are built to last. And normally they possess a great culture with strong values, focused on having a profound positive impact. Mercenaries, on the other hand, do things as quickly as possible with the aim of selling their company or just gaining as much profits as possible.
People may have a job, career, or calling. Career includes job, and calling includes calling. But calling has a greater meaning. If you want to be happy with what you do at work, you should definitely find your calling and not pursue career or just job.
Toyota wanted Japan to be known for quality, not itself. This is great example of going beyond yourself. Amazon’s mission is to be the planet’s most customer centric company. They wanted and made this mission come true - now every single company tries to emulate this level of customer obsession. This is the mission that makes people come to work with the sense of great purpose and meaning.

11) Work life balance/harmony.
The vast majority of our life will be taken by our job. It is totally true that our personal and professional lives are highly intertwined. For that very reason it is critical for us to know how to get along with hardships and hurdles at work without making it affect our personal lives. The secret is in energy. We should design our personal and professional lives in such a way that they do not take or consume energy, they endow us with energy! You never want to be a person who enters a room and the energy drains instantly. You want to add energy, you want people to be happy to see you. For that very reason it is so essential for us to love what we do at work and enjoy our family lives so that when we come home, we are highly energized and same with work - you don’t want to come to work unhappy. Worklif
Spending more time at home doesn’t necessarily mean improving the quality of your relationships with people you love. Work-life balance term implies strict trade-off which is not necessarily what you want. You need the quality time but not necessarily more time with people you love. Thus, your closed ones would love you to go to work and solve all your problems instead of being with them full of nerves and stressed out.
Work-life harmony implies a specific mix that we should identify for ourselves and keep it. We should invest in every domain enough for it to bring energy back not to take it excessively.

12) How to manage stress.
People are way too often stressed out at work. And Jeff gave a great understanding about stress - it comes from the lack of control over your life. The things that should be under control, should be taken care of, the rest should be just kept in mind but they must not bother us. The things that are beyond of our control do not worth our energy. Therefore, it is essential to constantly raise the control level of our lives so not to be stressed.
Sometimes people think that they need to relax more to be less stressed. It may have some sense when it comes to energy recovery. Yet, we should still keep in mind that the control defines everything. We may relax all day long at home and be incredibly stressed out because of the dire circumstances at work. We can’t relax and sleep well if things are on fire at work, right? That’s why on the other hand, we may work extremely hard and never be stressed because we feel control over the things.
The minute we start solving some problem is the minute we relief our stress and gain control over the situation.
Focus on the control.

13) Sense of Opportunity Urgency.
We live in the world abundant with opportunities. And we also need motivation. Why not to use opportunities as a source of great motivation? When you know that there is some opportunities that could be seized and taken advantage of, yet which is limited, it gives you enormous amount of drive and desire to work. Opportunity urgency defines the pace with which you move, the decisions you make, and the way you think. It is essential to have such a sense to keep the inertia and momentum. High levels of competition and opportunity may drive your productivity to the skies. Get into the game of high opportunities and enjoy the great growth rates.

14) Velocity matters.
As a continuation of the previous point, it is essential to point out that Jeff always demanded highest possible speed of execution without a loss in quality. Velocity is the thing that defines who will survive in the market. Velocity may define whether you will have the first-mover advantage or you will always be the second follower. Sometimes it is essential to adapt yourself to the new realities as the COVID showed us and if we are slow at adapting, then we may be out of the game very soon. Making mistakes is crucial in learning but making them fast and changing quickly is what defines the winner. All the deficiencies must be killed as soon as they are identified. And we should keep in mind that velocity is a single biggest advantage of a startup culture that helps young companies to survive. Yet, at the same time, we should remember the two types of decisions. Blue Origin has a great motto: “Step by step ferociously” - which implies every step taken carefully and on time without haste but with high precision. Jeff has also referred to US military slogan: “Slow is Smooth and Smooth is Fast” - so we should always be careful what kind of mode we have. If the stakes are high - measure twice and cut once.

15) Your margin is my opportunity
Jeff is known for his obsession over driving costs down and keeping margins low. Once he was asked what he would do if the margins were high, he laughed and said - that would be a whole different business. It is hard for people to think long term, that’s why they are puzzled why to invest in the future when you can get gains now? But long-term thinkers like Jeff vividly see how glorious returns may appear to be over time given enough resources and time.
We should go for absolutely margins not percentages. In absolute terms we should grow our margins, which means we make things more efficiently and bring more and more value for our customers. But percentage of margin should be kept low which implies that we invest enough in the future. The future is to come and it should be more beautiful that today, isn’t it?

16) Be honest: rock concert vs ballet.
You may hold a rock concert, and you may hold a ballet. Each of them can be successful. Just don’t hold a ballet and advertise it like a rock concert! There are investors of all shapes and sizes. They will self-select. Be transparent with your strategy whether you are a highly risky business focused on the long term.

17) Operational Excellence
Mistakes made because of poor execution could not be considered desirable at all as we don’t learn anything from them. It is just poor planning and execution. Operational excellence imply a number of essential aspects. You should work with professional pride for what you do and do it with highest possible quality - that’s what is called excellence.

18) Day One Mindset: Decentralization & Two Pizzas rule
Keep Day One Mindset - no matter how great expertise you gain overtime, you need this Day One Mindset to have a fresh look at old things. That is essential to innovate and see new opportunities. Decentralization is essential to keep the startup culture and remain nimble. Bottom-up approach saves a lot of time and creates autonomous teams. Two pizzas rule is a great example of it - if you can’t feed a team with two pizzas, it is too big and inefficient which slows down decision-making and lowers operational excellence.

19) Be bold: go big or go home.
Sometimes scaling fast could be a great idea to make a lot of mistakes and learn from them quickly as well. Don’t be afraid to grow fast. Keep everything under control and think big. In Amazon’s case it was true that if they don’t scale up quickly and grow very fast, their business could be eaten by other giants of the industry including Walmart and Barnes and Nobles. Today all of their old competitors combined are less valued in the market than Amazon alone.