Jeffery P.

Bezos
Amazon.com

Report Submission

To: Ma’am Amna Talat

By :
Bareera Abid
Ghias Sadiq
Mashal Idrees
Mustafa Noor
Omer Tahir

12/3/2018
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Jeffery P. Bezos

Contents

Detailed background ....................................................................................................................... 3

Career Path .................................................................................................................................. 3

Key takeaways from Jeff Bezos’s leadership style: ........................................................................ 5

Amazon’s fourteen leadership principles : ..................................................................................... 8

Lessons of innovation from Jeff Bezos:........................................................................................ 10

Innovations from the mind of Jeff Bezos: ................................................................................. 12

Decision Making Rules ................................................................................................................. 13

Human Resource Objectives of Amazon.com .............................................................................. 15

HR policies.................................................................................................................................... 15

The core of recruitment policies: ................................................................................................ 15

Employee Retention policies: ..................................................................................................... 19

Promotion Policy at Amazon ...................................................................................................... 21

Equity Sharing ............................................................................................................................ 21

Diversity Management ................................................................................................................ 22

Amazon’s HR goals ...................................................................................................................... 26

HR Controversies at Amazon ....................................................................................................... 26

Amazon’s Organizational Culture ................................................................................................ 30

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Jeffery P. Bezos

Detailed background
Jeff Bezos is the founder and chief executive of Amazon.com and also the owner of the
Washington post.

He was born on 12 January 1964 in Albuquerque Mexico. Jeff Bezos was born to a teen mother,
Jaclyn Gise Jorgensen, and his biological father, Ted Jorgensen.

The Jorgensens were married less than a year, and when Bezos was 4 years old his mother
remarried, to Cuban migrant Mike Bezos. He studied computer science and electrical
engineering from Princeton University.

After his graduation he started working on Wall Street and became the youngest vice president
of an investment firm D.E Shaw.

After four years he left his job to open Amazon.com which became one of the biggest internet
success stories. In 2013 he purchased the Washington post for $250 million. As a child, Jeff
Bezos showed an early interest in how things work, turning his parents' garage into a laboratory
and rigging electrical contraptions around his house.

He moved to Miami with his family as a teenager, where he developed a love for computers and
graduated valedictorian of his high school.

It was during high school that he started his first business, the Dream Institute, an educational
summer camp for fourth, fifth and sixth graders.

Career Path

Bezos moved to Miami, Florida with his family when he was still in high school. There
he attended the Student Science Training Program at the University of Florida and received a
Silver knight award in 1982.
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Jeffery P. Bezos

During his high school years Bezos laid the foundation of his first business ventures, The
Dream Institute, which was a summer camp for 5th and 6th grade students.

In 1982 he got in to the Princeton University where he took computers as his majors.
While at university he took up summer jobs as programmer/analyst in Norway, the next year he
improvised an IBM program in California.

In 1986, he graduated university with a B.Sc in Electrical engineering and computer

science. After graduation he worked at several firms on the Wall Street, such as Fitel Bankers
Trust and an investment Fund D.E. Shaw.

At D.E.Shaw & co. he became the youngest V.P there. His career in finance was
extremely promising but he decided to quit after a few years.

In 1995 he laid foundation of his own e-commerce startup ‘Cadabra’ that later came to be
known as “Amazon.com’. Initially there was much skepticism surrounding Bezos’s startup.
Market Analysis did not believe it would succeed in comparison to traditional book stores but
soon enough Bozos outpaced his competitors and in 1997 the company went public for the first
time.

With time Amazon started expanding the range of products it was providing to its
customers, from books to CDs, videos and in 2002 it also included clothes in its portfolio.

In 2003, Amazon came up with a formed A9 commercial search engine focusing on e-

commerce web sites. He further launched an online sporting goods store that offered up 3000
different brands.

In 2007 Amazon introduced its first ever hand held electronic reading device, the Kindle,
which used e-ink with adjustable font-size to enhance ease of reading.

Later in 2010, Amazon introduced Kindle Fire, a color touch screen mini tablet, coming
into direct competition with Apple’s iPad. Kindle Fire gave its e-readers comfort and
convenience with illuminated touch screens that enabled reading in the dark.
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Jeffery P. Bezos

Apart from that Amazon also expanded its horizon in the form of Amazon Studios,
Living Social and Amazon Web Services. Amazon plans to present the television programs
through an online video service.

In August 2015, Bezos became the owner of the Washington Post and other publications
affiliated with the Washing Post and Co for a total of $250 Million.

Key takeaways from Jeff Bezos’s leadership style:

1) Vision Matters
In one of the first few of his letters to Amazon’s key shareholders, Bezos announced his
intention to take a long term perspective. He never pushes his staff to focus on or
optimize the quarterly results at the cost of long-term goal. He further lays down the
foundation for his vision, which he articulates in 1999:
“Our goal is to build the most customer-centric organization on this earth, a place where
people can get anything and everything that they need or want. All online.”
(1999)
This view still hold true to this date; particularly the customer centric approach of
Amazon. Whether its books, Amazon Web Services or Alexa, they begin with their
consumers and always work backwards.
“I consistently tell my employees to wake up terrified. Not of the competitors but
customers. They have made our business what it are today, they are the ones in a
relationship with us, and they are the ones whom we owe our obligation.” (Jeff Bozos)

2) Improve your thinking, Simplify your message

One thing that Bezos is known to loathe the most is long-hauled power point
presentations. Instead of meetings, managers and staff are provided with a 6-page memo
that explains the entire agenda of their meeting.
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Jeffery P. Bezos

This approach not only allows every employee from the manager to lower level staff to
get on the same page in regards to the meeting and start from there but also guides
everyone to be concise with their approach in terms of coming up with ideas to put on the
table.
In Jeff Bezos’s words if you can’t explain something in simple language, there’s a great
chance you are not knowledgeable enough. Great entrepreneurs like Jeff Bezos think
their plans through, they understand what’s required and they know their target audience.
They are quick to boil their complex ideas into something simpler and they know how to
position their products and brands into the minds of consumers.

“Any Damn fool can make something complex. It takes a genius to make something
simple.”

For example, about Audible (the audio book company Amazon acquired in 2008) Jeff
Bezos said, “Audible makes it easy for you to read when your eyes are busy”.

3) Staying Committed
As indicated in Bezos’s first shareholder letter, Amazon has a long-term oriented vision
in terms of its performance, revenue generation and judgment of brand performance. All
decisions are made in that light.
According to Bezos, Sticking to a long-term vision in the face of tribulation is hard. It
takes guts, sincerity, and a plan that makes sense.
“It took a less safe path for me to follow my passion, and I am proud of that.”

4) Make your employees leaders

At Amazon employees are generally trained to be their own leaders, they have a total
control over their projects and thus have much larger room to grow, expand as
individuals and come up with innovative and out of the box ideas and although it means
putting a huge amount of faith in people’s abilities, according to Jeff Bezos, it is
compulsory to guide people and let them be their own leaders instead of guiding them to
the path that you want them to follow.
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Jeffery P. Bezos

“If you desire your organization to grow, you need to let people astonish you with their
flairs”.
Amazon’s ‘one click check out’, considered a game changer in the e-commerce arena,
was an idea that was developed by a small team of a few people who were racking their
brains for an idea to make the process of buying easier for its customers.
Jeff Bezos leadership style is all about empowering its employees to take gut-decisions
and own up to the results.

5) Take Risks
Jeff Bezos’s leadership style tells us a great deal about his nature to take high-end risks.
Previously employed at Wall Street Heed fund, Bezos quit his job to start an ecommerce
business before most people even knew what the internet was. In an interview Bezos
revealed that he gave himself a miniscule 30% of his e-commerce business succeeding
“That’s actually a very liberating expectation, expecting to fail.”
In 2015, Amazon released its fire Smartphone that became one of the largest failures
Amazon has ever had to experience. Within months of its release the price of the
Smartphone went down from $199 to 99 cents.
“If you think that’s a giant failure, we’re working on much bigger failures at present
that’s going to make our smart phone failure seem like a blip in comparison — and I am
not joking,” he said in a 2016 interview.
Similarly in 2015, Amazon released another branch of its, ‘Amazon Destination’ that was
a short-lived travel reservation service focused on short, local getaways. The company
ran out of business in the same year.
“I am never haunted by failures, although I suspect I would be haunted immensely by a
decision to not try at all.”
6) Grab the external trends
In his letter to his shareholders Bezos highlighted and stressed on tar need to embrace
external trend if they wanted the company to grow and remain consistent in its growth.
According to Bezos, many big organizations fails to go to the next round based solely on
this weakness or temporary laziness in going after or embracing the change.
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Jeffery P. Bezos

Hence one might notice how Amazon is always on the brink of capitalizing on new
technologies.
These big trends are not that hard to spot (they get talked and written about a lot), but
they can be strangely hard for large organizations to embrace."
7) It’s always Day 1
A day one company always makes decisions with one thing in mind "It's always a new
day where experimenting, innovating and inventing is a norm”. Such companies are
obsessively customer-centric and do not focus on becoming prisoner to the process. Not
only this but they stay in touch new, up and coming trends and stay ahead of their
competitors in the game.
“A Day 1 Company adopts a "learn-it-all" culture instead of a "know-it-all" one. It
practices 4Cs of leadership (creating, collaborating, changing, and challenging). And it
always desires to be in a state of creating new growth engines and business models for
the future.” (Bezos, 2014)

Amazon’s fourteen leadership principles :

1. Customer Obsession
Leaders start with the consumer and work backwards. They work tirelessly to earn
and retain their customer’s trust.
2. Ownership
Leaders are supposed to be owners. They think along the lines of long term and don’t
sacrifice long-term value for short-term results. They act on behalf of the entire
company, beyond just their own team without saying“that’s not my job.”

3. Invent and Simplify

Leaders expect and require innovation and invention from their team members and
always find ways to make things easier. They are externally alert, searching for new
ideas from everywhere.
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Jeffery P. Bezos

4. Are Right, A Lot

Leaders are correct a lot. They have strong judgment and good instincts.

5. Learn and Be Curious

Leaders are never finished learning and always seek to improve themselves. They are
inquisitive about new potential and act to explore them.

6. Hire and Develop the Best

Leaders lift up the performance bar with every appointee and promotion. They make
out people with outstanding talent and freely move them throughout the organisation.
Leaders mentor leaders and are serious about their role in coaching others.

7. Insist on the Highest Standards

Leaders have persistently high values – a lot of people may believe these standards
are unjustly high. Leaders are repeatedly raising the bar and driving their teams to
deliver high quality products, services and processes.

8. Think Big
Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold
direction that inspires results. They think differently and look around corners for
ways to serve customers.

9. Bias for Action

Speed matters in business. Many decisions and actions are reversible and do not need
extensive study. We value calculated risk taking.

10. Frugality
Accomplish more with less. Constraints breed resourcefulness, self-sufficiency and
invention. There are no extra points for growing headcount, budget size or fixed
expense.

11. Earn Trust

Leaders listen attentively, speak candidly, and treat others respectfully. They are
vocally self-critical, even when doing so is awkward or embarrassing. Leaders do not
believe their or their team’s body odour smells of perfume. They benchmark
themselves and their teams against the best.
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Jeffery P. Bezos

12. Dive Deep

Leaders operate at all levels, stay connected to the details, audit frequently, and are
sceptical when metrics and anecdote differ. No task is beneath them.

13. Have Backbone; Disagree and Commit

Leaders are obligated to respectfully challenge decisions when they disagree, even
when doing so is uncomfortable or exhausting. Leaders have conviction and are
tenacious. They do not compromise for the sake of social cohesion. Once a decision
is determined, they commit wholly.

14. Deliver Results

Leaders focus on the key inputs for their business and deliver them with the right
quality and in a timely fashion. Despite setbacks, they rise to the occasion and never
compromise.

Through these principles, Amazon is able to employee individuals who would become a
part of a dynamic work team.

Lessons of innovation from Jeff Bezos:

In today’s world, people see Amazon as an e-commercial site, a retailer, and an innovative tech
company. Its products and services range from cloud computing, original content, Alexa, direct
publishing platform and many other things.

However, contrary to how consumers see Amazon, Bezos sees Amazon as an approach

“We have a very distinct approach that we have been polishing and refining, and thinking about
for 22 years. It’s really just a small number of principles that we use, as we go about thinking
through the different activities we work on.”

These Principles are:

1) Consumer obsession
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Jeffery P. Bezos

“Leaders begin with the consumers and work your way backwards. They work
enthusiastically to earn and retain customer trust. Although leaders concentrate on
competitors, they obsess over consumers.” (Official Website)

Customer obsession is the primary driving force behind Amazon’s business. Unlike other
businesses they don’t have a competitor obsession, technology obsession, or product
obsession model instead they preach a consumer obsession model. According to Jeff Bezos,
while customer obsession can be a very successful strategy for some company’s customer
obsession is the right one for Amazon.

Take Amazon Prime for example, a paid subscription service with a free two day delivery
service designed for consumers who loved free shipping. The service drew ire for being ‘too
good to be true’ and so negated any idea about Amazon being too profitable as it was too
inexpensive to be considered too profitable. However it is clear now that pleasing its
customers, rather than obsessing over Amazon’s short term bottom line, has been a very
carefully planned business move as today about $1300 revenue (on average) is spent by
Prime members (100+ million people globally) , annually, which is twice that of non-
members.

2) A willingness to invent and pioneer

This goes along well with consumer obsession as according to Bezos, customers are always
discontent, even when they believe they are content. They do actually want a better way; they
just do not have a clear idea of what that way should be.

According to Besoz, customer obsession is not just listening to your customers, but also
inventing on their behalf.

3) Long Term orientation

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Jeffery P. Bezos

Bezos encourages his employees to think in 5-7 year timeframes instead of a 2-3 year
timeframe. However since patience is not a mentality that comes natural to humans,
Bezos believes it’s a discipline that you have to train and build for.

“If you start to think this way, it will change how you spend your time, how you sketch,
where you put your energy. Your ability to look around corners improves. Many things
just get better.”

4) Train employees to think like owners

Since the beginning of Amazon one of the things that Bezos has been consistent about is
hiring and recruiting the right people for his firm. “We will continue to focus on hiring
and retaining talented and versatile individuals. We know our success is largely based our
ability to attract and retain a motivated and talented employee base, each of whom must
think like and thus, must actually be in essence, an owner.”

Innovations from the mind of Jeff Bezos:

1) Amazon Go

Despite the popularity of ecommerce websites like Amazon, selling groceries online is
not an easy job. An even company like Peapod who has been front runners in the market
doesn’t have the numbers that brick and mortar grocery stores do. Luckily for Amazon,
Bezos realized that and decided to go against the idea of an online grocery store, instead
creating Amazon Go.

Amazon Go not only provides customers with all the items that they need but also has
impressive technology to allow its customers to skip the line process. By just hooking it
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Jeffery P. Bezos

to Amazon Pay account one can literally walk out of the stores with all the food items
without to stop at the checkout section.

2) Voice orders on Alexa through Amazon prime

Between Siri, Google Home and Amazon’s Alexa, the digital assistants of today’s time,
people’s lives have been made infinitely easier. However, due to the young age of such
technology the engagement and ability of these items are also minimal. Nevertheless,
following the innovative orders of Jeff Bozos, Alexa has emerged as the leader of digital
assistants as Amazon has made voice orders possible.

With such innovation consumers would be able to order any item via the popular device
without much effort.

3) Blue Origin’s Paying Customers

Recently, Jeff Bozos, along with a handful of other entrepreneurs, locked down his first
paying customer in his mission to make space travel a norm for everyday people.

Only just, French based company Eutelsat entered into a low-commitment agreement
with Bezos’s Blue origin, focused on making trips to the outer space (outside of
government programs). Bezos hopes to make this goal of his come to life by 2020.

Decision Making Rules

When it comes to decision making in an organization, Jeff Bezos is one of the obvious people to
look up to for guidance.

1) ‘Never Use one size Fits all decision making strategy’

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Jeffery P. Bezos

Bezos argues that decisions can be classified into two categories since not all the decisions are
prone to have similar consequences. Type one decisions are not able to be reversed and so the
process that goes into the making of such decisions requires great focus.

Type 2 decisions are the ones that are easily reversible. According to Bozos, ‘"As organizations
get bigger, there seems to be a trend to use the heavy-weight Type 1 decision-making process
on most decisions, including many Type 2 decisions. The end outcome of this is tardiness,
unthoughtful risk aversion, failure to experiment sufficiently and, consequently, diminished
invention."

Bezos also believes that it is important to not take any short cuts whilst making decisions as
companies that habitually use Type 2 decision making process to make Type 1 decisions usually
fail before they get large

2) 70% of the information rule

According to Bezos in most scenarios holding off until you had 90% or more of the information
that you need before making a decision will just slow down your decision making process. For
this reason Bezos has a 70% of the information rule which suggests that in most scenarios 70%
of all the information that you wish you had is enough. If you wait for the other 20% you are
going to get slow and that is going to be more expensive, for sure.

3) Disagree and Commit rule

This is the rule that, according to him, Jeff Bezos abides by the most and applies when he
believes that the consensus is not possible.

In his opinion healthy disagreements are essential for the digging and evaluating of a full
range on unexplored ideas, however infighting can also hold back the execution of
whatever is decided. One can balance these competing realities by using the ‘Disagree
and commit rule’ according to Jeff Bozos, which works best when you give the gamble a
timeframe.
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Jeffery P. Bezos

“I disagree and commit a lot of the time. We recently thought of a particular Amazon
Studios original. I told the team my analysis: arguable whether it would be appealing
enough, complicated to fabricate, the business terms aren't great, and we have lots of
other opportunities. They had a wholly different view and wanted to continue with the
idea. I replied back right away with "I disagree and commit and look forward to it
becoming the most watched thing we've ever made."

Conclusion:

Judging From the very precise and clear cut rules of Jeff Bezos, we can safely conclude that the
core of his decision making strategy generally boils down to, ‘You are allowed to be wrong and
make mistakes but you are not allowed to be slow.”

Human Resource Objectives of Amazon.com

The main objective of the HR department at Amazon is to recruit best fits for the company and to
keep their associated safe, engaged and productive so that their fulfillment centers could remain
the most innovative on Earth.

HR policies

Bezos believes that Amazon should hire the right people.

He stated, “I’d rather interview fifty people and not hire anyone than hire the wrong person.
Setting the bar high in our approach to hiring has been, and will continue to be, the single most
important element of Amazon.com’s success” (Pike, 2014).

The core of recruitment policies:

Bezos got a lot of his inspiration in terms of hiring and recruiting from his experience in an
investment-management firm called D.E. Shaw, where the recruitment process was generally
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Jeffery P. Bezos

considered very rigorous with recruiters often asking candidates random questions like, “How
many fax machines are there in the United States?”

The main goal in this strategy was to judge the candidate’s problem solving ability and see if the
person was a good fit (mentally) to the company.

Although in its early days when Bezos was still driving delivery trucks and had a team of 10
working under the banner of ‘Cadabra’ (later changed to Amazon), one of the things that Jeff
Bezos was very consistent about was the quality of his work force. In his 1988 letter to
shareholder Bezos described his team of 2100 employees as ‘Smart, hardworking individuals
with a customer-centric approach in regards to the business’ and credited the raising of bars in
terms of hiring his employees. In his words hiring policies and practices are the single most
important element that needs to be continually checked to ensure Amazon’s continuous growth.

In order to ensure the continuous thriving of the company, Bezos came up with a simple 3 –
question test for hiring new employees in his letter to shareholders in 1998, a year after his
company went public.

The three questions being

1. Will you admire this person?

In the first question Bezos encourages his recruiters to think about their own, personal
opinion of the person that they are interviewing. In Bezos’s opinion hiring people on your
team that you would be willing to respect increases the possibility of you learning from
them and teaching them.

“I have always tried to work with those I admire, and I expect the folks here to have the
same approach. Be just as demanding. I tell them to hire those they would be willing to
work for.”

2. Will this person increase the level of effectiveness of the group they will be becoming
a part of?
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Jeffery P. Bezos

The purpose behind this question is to get a sense of the person’s capacity to innovate.

"We want to fight entropy. The bar has to go up with consistence. I ask people to
visualize the company 5 years from now. At that point, each of us should look around and
say, 'The standards are so high now — boy, I'm glad I got in when I did!'"

Today, Amazon is perceived as an extremely demanding work environment, where high standard
are etched in the core of the company.

Those who lead persistently increase their standards; people might think of these standards as
unreasonably high but in order to ensure the quality of products, services and processes being
delivered, you have to continually raise the bars for your team.”

To ensure that it is hiring the best out of the bunch, Amazon has a group of its own employees be
appointed as ‘bar raisers’. Not only these bar raises perform their own jobs but are also tasked
with providing additional outlook on new hires around culture fit and talent.

3. Along what dimension might this person be a superstar?

Bringing in people with unique talents is also one of the 14 Leadership principles on the Amazon
website.

According to Bezos many people have unique skills, interest, and perspectives that enrich the
work environment for everyone around. Often it’s not even something directly related to their
jobs, but it’s important to embrace individuality and individual talents.

For example, in his 1988 letter to shareholders, Bezos conveyed his excitement for hiring a
national spelling bee champion. “I suspect it doesn’t help her in her everyday work = but it’s
entertaining when you occasionally snag her in hall with a quick challenge,” he wrote.

"I suspect it doesn't help her in her everyday work, but it does make

Hiring Process at Amazon:

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Jeffery P. Bezos

The hiring process at Amazon usually takes about 2 to 3 weeks to commence.

It is slow, methodical, and intense. Recruiters are required to work very hard to ensure a good fit
and, hence, strive to find the perfect candidate appropriate for the position. Generally, they will
go to great length at analyzing their candidates thinking questions like,

Does this person fit in with culture?

Will they be happy working with the team?

Are they up to the demands and requirements to be highly independent?

Can they handle the stress that many Amazon jobs come with?

Will this person not only do well but will they be promotable?

For recruiters, it’s not just about technical skill or the ability to align your experience with the
job description.

All the recruiters are required to coordinate reviews and agree that you meet all the areas they
have decided to review as well as your fit with the 14 leadership principles of the company. This
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Jeffery P. Bezos

policy of unanimous decision is something that Jeff Bezos himself focus a lot on and it’s
something that he learned from the last organization that he worked at, i.e., D.E Shaw.

According to a software engineer at Amazon, Gideon Shavit, to this day Amazon uses much
similar hiring techniques that Bezos learned at D.E Shaw. Once every one has voted, the
recruiters also try to determine whether the candidate raises the bar, meaning wither that person
is at least as good or biter than the average current Amazon employee in target position.

The rigorous hiring process is something that Bezos makes no compromise on as in his own
words, “I’d rather interview 50 people and not hire a single one of them than hire the wrong
person”.’

Employee Retention policies:

1) The ‘Pay to Quit’ policy:

Once a year Amazon offers $5000 to its employees to quit. Although it might seem
otherwise at first glance, according to Michael Burchel, a workplace culture expert,
policies like this actually enhances employee engagement and saves’ the organizations
money in the long term. Pay to quit, as the policy is called might not make employees
work harder but it does increases their level of commitment to the organization.

According to various studies done on this topic, employee engagement and

disengagement has a noteworthy impact on an organization’s performance. According a
2016 Gallup Meta analysis of employee engagement, companies whose employees had a
higher degree of engagement had 21% higher productivity and close to 28% less theft.
Not only that but employees in such organizations has less chances of being absent from
work and have fewer chances of them comprising on the quality of output they are
producing.

Whereas disengaged workers proved much more costly (costing over $34000 for every
$10000 in salary) to the organization annually.
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Jeffery P. Bezos

Annually, we present our employees with a chance to quit in exchange for money. The
first year the offer made is about $2000; it goes up $1000 each year until it’s finally
$5000. We usually request the employees not to take this offer. We want them to stay but
we want them to pause and think about what they really want. In short term it might be
costly to the company. In the long term however it’s healthy for the company as at the
end we are left with engaged and loyal employs. (Jeff Bezos in his letter to shareholder)

2) Pivot Policy

In 2017 Amazon announced its ‘Pivot’ policy that’s designed to retain its
underperforming employees. Prior to the pivot policy Amazon had a Performance
Improvement program. Being named in that program usually meant a likely termination.
However, with Pivot employees are able to

a) Get coaching from a ‘Career Ambassador’ to bring their performance up to par.

b) Ask for an appeal regarding their placement in PIP.

c) Quit with severance pay

“Pivot is only part of Amazon’s dedication to enhance working environment for our
employees whilst giving us a chance to retain talent and making the organization a more
positive place to work at.” (Jeff Bezos)

3) Stock Vest Retaining Policy

All employees at Amazon, hired for full time jobs are eligible to receive Amazon’s
common stocks called the ‘Reserved Stock Unit’ after the completion of their vesting
periods. Vesting period is a particular amount of time one must spend at Amazon for the
RSUs to become Amazon.com shares.

Employees, the theory suggests, would stick around for the particular time period that
would take the stock to vest, during which the organization would extract enough value
out of them to make the relationship worthwhile.
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Promotion Policy at Amazon

The decision whether a person is eligible for promotion or not is usually a joint decision
by managers at Amazon. These debates take place at two different meeting during
different time of the year

In the first meeting (usually February or March), the senior staff discusses employees
performance, and if their performance is up to the par, and decide who is getting the
promotion based on their performance.

In the second meeting (usually takes place in September or October), the leaders
compares performance of employs and decides who is eligible for promotion the
following year.

In these meetings the employees are divided into three groups:

Group 1: The top 20% - eligible for promotion

Group 2: The next 70% - who are retained and encouraged for better performance for
eligibility the following year.

Group 3: The bottom 10% who are either placed in PIP for termination or Pivot.

This system was designed by Jeff Bezos himself with the intention of cutting politics and
in-fighting. Unfortunately, studies shows, those ambitious employees spend months
having lunch and coffee with their boss’s peers to ensure a positive outcome once the
promotion time comes.

Equity Sharing

An RSU or a Restricted Stock Unit is a right that Amazon provides to its employees to
receive common shares of the organization after they have satisfied the vesting period
(The vesting period is a particular time frame that employees have to spend at the
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Jeffery P. Bezos

organization before shares in an employee stock option plan or benefits them a retirement
plan or are unconditionally owned by the employees. If anyone’s employment terminates
before the completion of this period, the organization can buy the stock back at the
original price).

Who is eligible to receive Amazon’s Restricted Stock units?

Generally employees that are hired for full- time are eligible to receive RSUs.

Employees receive a restricted stock unit award when they are hired, any additional RSU
awards are determined on annual basis.

“For instance, if you were rewarded 10 RSUs with a two-year vesting period on April 1,
2013, the vesting period for those 10 RSUs would finish on May 15, 2015. Normally, to
satisfy the vesting requirements, you can have no breaks in service during the vesting
period and you must be a full-time employee at the time the RSUs vest. Information about
breaks in service is located on Inside Amazon. Vesting periods will be stated on your
Amazon RSU Award Agreement.” (Amazon Information Portal)

Diversity Management

Amazon’s diversity Programs:

1) Affinity Groups
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Jeffery P. Bezos

At Amazon an affinity group is a group of people that come together on the basis of common
characteristic, trait or interest.

These affinity groups plays a crucial role in building internal networks for career
development, advising business units of Amazon and participate in policy discussions.

Amazon has a number of affinity groups

1) Amazon’s Black Employee Network

BEN as members like to call it is a black affinity group at the Amazon that has a specific
mission to recruit, retain and empower black employees. BEN connects its members with
mentors or guidance counselors to help them in their career and personal development

2)Latinos@Amazon

This particular affinity group is focused on building a stronger community for Amazon’s
Latino employees, with their central focus on hiring, retaining, and developing talent,
contributing in community outreach. This group also has internal mentorship programs,
specific social and cultural events and they are also active participants in recruiting efforts at
national conference and universities.

3)Warriors@Amazon

This affinity group comprises of current and former military personals, their families and the
employees that support then. This group has the sole purpose of providing military veterans
with professional network that helps them transition (professionally) into civilian life, more
specifically Amazon’s workforce.

4) Amazon Women in engineering

5)Asians@Amazon

This affinity group helps recruit, hire and connect Asian employees across the globe based on
their common traits and experiences. Not only this but asian@amazon is committed to
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Jeffery P. Bezos

provide access to its members to career development, networking and community-building

opportunities.

6) Wi-Fi (Amazon’s women in Finance)

7) Glamazon (Amazon’s LGBTQ affinity group)

This particular affinity group works for the purpose of educating people about the LGBTQ
community. This group not only mentors fellow members but also promotes diversity and
visibility in recruiting and throughout Amazon.

8) Amazon PWD (Amazon’s affinity group for employees with physical disabilities).

“Our affinity groups are a representation of Amazon’s efforts to recognize, we are all
different but we are all valued here at Amazon”. (Jeff Bezos)

One of the instances where the leaders of these affinity groups had to step up and curb the
feeling of despair amongst employees came right after the U.S elections of 2016. The affinity
group leaders conjured up a collective email directed at Amazon’s CEO Jeff Bezos sharing
with him their insecurities and how they felt personally threatened by the unexpected results
of the elections.
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Jeff Bezos replied

reassuringly to what he
referred to as a ‘heartfelt’
email by his concerned
leaders,
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Jeffery P. Bezos

2) AmazCon

AmazonCon is an internal conference plan at Amazon where

about 20 speakers (leading scientists, artists, and business
leaders) come together to highlight the importance and
business benefits of gender diversity at workplace, every
year.

“Amazon has over 500,000 employees round the world, and from our very beginning,
we’ve been dedicated to equality at our workplace. We wish our workers to be leaders,
authorized and to speak their minds, and to be heard. Each person here ought to feel
secure and comfortable sharing their individuality with everyone around. It is one of our
goals to create a mindset that although we are all different but we are equal”. (Jeff Bezos
speaking at AmazeCon 2015)

Amazon’s HR goals

Digitalizing the HR and constantly raise the bar:

One of Amazon’s goals is “We seek to be the most technically proficient HR

organization in the world.” So for that purpose technology ought to be the prime driver of
change at HR. A digitalized HR would be efficient in a way that all information could be
instantly electronically shared amongst people, processes and machines.

Apart from that one of the major goals of Amazon is to constantly become better and
improve their techniques in order to make their working environment healthier and more
engaging for the employees, as Bezos said in an interview “In today’s fast-changing
world, continuous improvement is an absolute necessity”.

HR Controversies at Amazon
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Jeffery P. Bezos

1) New York Times “Inside Amazon: Wrestling Big Ideas in a Bruising Workplace”

12th of August, New York Times published a massive expose of Amazon’s punishing
work culture. The article suggested that the company is conducting a ‘little known’
experiment on how far their white collar workers be pushed whilst redrawing the
boundaries of what is acceptable.

One of the ex-employees of the giant firm alleged that ‘Nearly every person I worked
with, I saw crying at their tables”. Other employees report emails that are sent after
midnight followed quickly by threatening texts in case it’s not replied to quickly enough

How was the crises dealt with?

Before the article was even out for people, Amazon’s CEO Jeff Bezos dispatched a
memo to his employees in an effort to minimize the negative impact the article would
have on the organization. Perhaps, commendably, he acknowledged the controversy and
told his employees to give it a read. Saying that “It does not describe the Amazon I know
or the caring Amazonians that work there.” Bezos also encouraged employees to go
straight to the HR in case they are facing any such situation or email him directly at
jeff@amazon.com

2) Lack of Diversity

In 2018, Amazon got into hot waters once again when its workforce diversity report
surfaced.
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Jeffery P. Bezos

As shown in the figures above more than half of the workplace i.e., Amazon’s non-labour
work force and the labour workforce comprised of white males. The largest minority
ethnic group employed by Amazon at the managerial level are Asians who make up 18% of
its managerial workforce. However only 4 percent of Amazon managers are black, and a
further 4% are Hispanic. At the management level the e-commerce giant has an especially
weighty slant with 75 percent of Amazon managers being men versus just a quarter being
female. Notice that in the picture below Out of 10 people in Amazon’s board of directors
(all white) only 3 are female)

Addressing the controversy:

After much backlash Amazon finally released a report to explain its position and defend
itself in the scenario

"Amazon has hundreds of millions of customers who can benefit from diversity of
thought," said Amazon in its report. "We are a company of builders who bring varying
backgrounds, ideas, and points of view to inventing on behalf of our customers. Our
diverse perspectives come from many sources including gender, race, age, national
origin, culture, education, as well as professional and life experience. We are working to
develop leaders and shape future talent pools to help us meet the needs of our customers
around the world."
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Jeffery P. Bezos

The report further suggested that the under representation of women and minorities was
mainly due to the lack of encouragement for these people to study technology and
sciences and not due to Amazon’s discouragement.

3) Opposition of the ‘Rooney Rule’

In the first week of May, 2017, Amazon came under fire from employees, shareholders
and even congress after its board decided to oppose a shareholder proposal aimed at
diversifying the workforce at Amazon by proposing that at least one woman and ane POC
should be interviewed for each opening.

After the boards vehement opposition to the proposed idea Amazon employees aired their
grievances on internal email threads.

Response to crises:

After much back lash Amazon’s board decided to give a go ahead to the Rooney Rule as
proposed by CtW investment group. While explaining its opposition to the opposition a
week prior, board cited complex reason and stated that such a rule would do no good and
would only go against Amazon’s policy of no differentiation based on race or ethnicity of
people.

4) Controversial Warehouse Treatment

In 2011, Morning Call interviewed about 20 Amazon Labors who revealed that the
conditions at the warehouse were pretty extreme. Labors were constantly pushed to exert
themselves which even caused them to pass out or daily basis because of extremely high
temperature (46 °C to be exact).

In June 2012, Amazon spent a further $52 (equivalent to 8.2% of Amazon’s 2011 Annual
earnings) million investment on the cooling of warehouse.

Response to crises
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Jeffery P. Bezos

Exactly 4 days after the article was published Amazon stated that it had spent about $2.4
million on the urgent installation of air conditioning at all the warehouses around the
country.

Amazon’s Organizational Culture

A company’s organizational culture sets traditions and values that shapes and influences
employees’ behavior. In essence, Amazon’s corporate culture pushes employees to
innovate and go beyond traditional limits to develop out of the box ideas. Amazon’s
corporate culture is well known for pushing its employees to embrace new trends, take
risks and develop new ideas. This characteristic of Amazon’s organizational culture is
mainly responsible for seeking new opportunities to utilize data-intensive processes for
carrying out their businesses efficiently.

And although as the world’s top e-commerce organization, Amazon is constantly looking
for new, fresh talent, in order for Amazon to maintain a capable workforce, Amazon has
to reinforce its organizational culture to shape the development of their HR department
for the purpose of achieving a long-term edge over the competitors.

“We’re a company of pioneers. It’s our job to make daring gambles, and we get our vigor from
devising on behalf of consumers. Success is calculated against the possible, not the likely”.

Characteristics of Amazon’s organizational culture:

1. Boldness

This characteristic of Amazon’s culture is a direct representation of Amazon’s CEO Jeff

Bezos’s attitude towards ‘taking risk’.

Amazon encourages its employees to be bold in taking their decisions. On their website
the employees are not referred to as ‘staff’, ‘workers’ or ‘employees’ but as ‘leaders’.
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Jeffery P. Bezos

The employees are pushed to give their best to come up with ideas that would facilitate
consumers, hence making their ‘Amazon experience’ more effortless. This characteristic
of the organization enables Amazon to identify the best possible idea to find solutions to
problems or make a mind boggling change to the e-commerce industry.

Customer-Centric

One thing that Amazon’s CEO Bezos puts the most stress on is the importance of having
a customer-centric approach in their everyday dealing. “Start with the customers and
make your way down backwards”. Employs are continually told to strive to determine
external trends and changes in consumer buying behavior, and asked to come up with
new ideas to make the consumer’s experience on Amazon pleasant and memorable.

“Consumers are always beautifully and amazingly dissatisfied, they might say they are
happy but they are always dissatisfied. So we have to constantly come up with ways to
make them satisfies because the moment you stop focusing on them, you would be
yesterday’s news.” (Jeff Bezos)

3) Always ‘Day 1’ mentality

Everyday employees are

encouraged to think of their day
in the Amazon’s office as their
day one on the premises.

To Bezos Day 1 means that

Amazon would always be
thought of (by the employees)
as a startup. Which could
encourage them to?

a) Obsess over consumers

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Jeffery P. Bezos

b) Embrace external trend

c) Focus on results over process

d) Making quality decisions with high velocities

“What does day 2 look like? Day 2 is stasis followed by irrelevance, followed by
excruciating, painful decline, followed by death. And that is why it is always day 1.” (Jeff
Bezos)

4) Peculiarity

This cultural characteristic implies to the idea of challenging everyday norms and
conventions. For instance Amazon challenges its employees to view themselves and work
as different from the conventional ways of doing business.

According to Bezos, conventions impose limits on potential business growth and result is
the organization fade into nothing.

Conclusion:

Judging from the organization culture of Amazon, it’s safe to assume that the firm’s
culture charectistics have a strong tendency to benefit innovation, for instance, boldness
and peculiarity directly promote new ideas to make Amazon the front runner at e-
commerce.

Whereas a customer-centric and the ‘Day one’ approach motivates its employees
everyday to come up with new, innovative, ideas to make their organization stand out in
the minds of consumers. This is essentially what every organization aims for.
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