These Unusual Catchwords Helped Scale Amazon Into a Multibillion-Dollar Company
Amazon started as an online bookseller in 1995 and has since grown into an e-commerce giant that reached a historic $1 trillion market valuation in September 2018. At the helm is Jeff Bezos, who has been there since the beginning and has managed to scale his company tremendously — not only in terms of scope and revenue but also company culture and vision.
Keeping an entire company aligned on culture and vision is challenging, but even more so when that company employs over half a million people. Former Amazon employee Eugene Wei credits Bezos’ use of concise expressions and catchwords as keys to successfully achieving this lofty goal.
“What Jeff understood was the power of rhetoric,” Wei wrote in a blog post. “Time spent coming up with the right words to package a key concept in a memorable way was time well spent. People fret about what others say about them when they’re not in the room, but Jeff was solving the issue of getting people to say what he’d say when he wasn’t in the room.”
In honor of National Thesaurus Day, take a look at the powerful words and inspirational catchphrases Bezos has used to scale Amazon into a multibillion-dollar company.
Day 1
In Bezos’ first letter to shareholders in 1997, he recapped Amazon’s incredible growth over the previous year and said, despite that, “this is Day 1 for the Internet and, if we execute well, for Amazon.com.”
What Bezos meant is that Amazon employees should always treat the company as if it were brand new, and follow four main principles: “customer obsession, a skeptical view of proxies, the eager adoption of external trends and high-velocity decision making.”
The Amazon CEO continues to stand by this philosophy, ending every shareholder letter with a copy of the original 1997 letter, noting, “Our approach remains the same, because it’s still Day 1.”
Day 2
In a 2016 all-hands meeting, Bezos was asked what Day 2 looks like — and he didn’t mince words with his response.
“Day 2 is stasis, followed by irrelevance, followed by excruciating, painful decline, followed by death. And that is why it is always Day 1.”
Resist Proxies
Resisting proxies is one of the main principles of Bezos’ Day 1 philosophy, and in his 2016 shareholder letter, he explained exactly what he means.
“As companies get larger and more complex, there’s a tendency to manage to proxies,” he wrote. “This comes in many shapes and sizes, and it’s dangerous, subtle and very Day 2.”
“A common example is process as proxy,” continued Bezos. “Good process serves you so you can serve customers. But if you’re not watchful, the process can become the thing. […] The process becomes the proxy for the result you want. You stop looking at outcomes and just make sure you’re doing the process right. Gulp. […] The process is not the thing. It’s always worth asking, ‘Do we own the process, or does the process own us?’ In a Day 2 company, you might find it’s the second.”
Get Big Fast, Baby
According to Wei’s blog, in addition to discussing his catchwords and key phrases in shareholder letters and all-hands meetings, Bezos also came up with an annual theme to keep all Amazon employees aligned on a specific mission for that year.
“One year, when our primary goal was to grow our revenue and order volume as quickly as possible to achieve the economies of scale that would capitalize on our high fixed cost infrastructure investments and put wind into our flywheel, the theme was ‘Get Big Fast Baby,'” he wrote in his blog. “You can argue whether the ‘baby’ at the end was necessary, but I think it’s more memorable with it than without. Much easier to remember than ‘grow revenues 80 percent’ or ‘achieve economies of scale’ or something like that.”
Getting Our House in Order (GOHIO)
“GOHIO” was another annual theme, chosen by Bezos when Amazon was approaching its $1 billion revenue milestone.
“One of Jeff’s chief concerns was whether our company’s processes could scale to handle that volume of orders without breaking,” wrote Wei on his blog. “To head off any such stumbles, we set aside an entire year at the company for GOHIO. It stood for ‘getting our house in order.’ […] Every group had that year of GOHIO to figure out how to scale to handle that volume without just linearly scaling its headcount and/or spending. If every group were just growing their headcount and costs linearly with order volume, our business model wouldn’t work. The exercise was intended to find those processes that would break at such theoretical load, and begin the work of finding where the economies of scale lay.”
Click through to find out which word billionaire Warren Buffett uses to measure success.
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