Amazon's scale and growth in the last 25 years remain unparalleled. In his 2021 Letter to Shareholders Andy Jassy, President and CEO of Amazon.com, describes Amazon's iterative innovation process to experiment, learn, and try to improve the customer experience, every day.
You can download the 7-step innovation framework in PowerPoint, PDF, and Google Slides at the end of the post.
The seven guiding principles of the Amazon innovation framework
Amazon follows 7 principles in its iterative innovation approach:
- Hire builders
- Use separate and autonomous teams
- Give teams the right tools and permission to move fast
- Have blind faith, but no false hope
- Define a Minimum Loveable Product (MLP), iterate fast from there
- Have a long-term view
- Brace yourself for failure
Amazon seeks employees who are curious and eager to create new things. People who challenge the status quo and strive for new methods to tackle problems.
Look out for people who keep asking why can’t it be done.
Organize Builders into Teams That Are as Separable and Autonomous as Possible
Amazon makes sure to concentrate a team of builders on a particular problem or customer. It is challenging for teams to have a thorough understanding of the many consumer concerns.
Single-purpose teams make better progress than shared resource teams.
Give Teams the Right Tools and Permission to Move Fast
Amazon allows teams to make two-way door (reversible) decisions themselves, thereby setting an expectation that speed matters.
Pre-condition for executing quickly are the right tools and leadership principles.
You Need Blind Faith, But No False Hope
Amazon knows that new ideas and innovations are often rejected because they haven’t been done before. Still, Amazon ensures and validates ideas with feedback from customer loops and teams that challenge each other.
They improve the odds of success with a product development process working backward from the customer's view. Teams always write a launch Press Release before building.
Define a Minimum Loveable Product (MLP), and Be Willing to Iterate Fast
Amazon launches products that are good enough that they believe they’ll be loved from the get-go (why Amazon calls it a "Minimum Loveable Product" vs. a "Minimum Viable Product"). It is better to get off with an MLP to customers and iterate quickly..
Adopt a Long-term Orientation
Amazon knows that transformational invention takes multiple years, especially if you are making big bets that you believe could substantially change customer experience (and your company)
So, you will need to. Be in it for the long haul, and keep going.
Brace Yourself for Failure
If you invent a lot, Amazon knows you will fail more often than you wish. Not all will work out if you are building new products and solutions. They secure great landing places for team members who deliver well.
Please make sure you learn from your mistakes.
Amazon's 7-step innovation framework
free template in PowerPoint, PDF, and Google Slides format
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