management
Why do we love Amazon?
A
Amazon recently eclipsed Walmart in
total market value to become the most
valuable retailer in the world. I became
an Amazon fan 15 years ago for three
reasons: They did what they promised;
they made purchase and payment easy;
and they never were out of stock.
These attributes might seem easy to
achieve. But providing on-time deliv-
ery for millions of customers for tens of
thousands of items from thousands of
suppliers is anything but simple. Ama-
zon succeeds because founder and
sole CEO Jeff Bezos focuses all of
the company’s energy on 14 key
principles found on the Amazon
website:
1. Customer obsession. Ama-
zon makes me feel special. They
know my name, my purchasing history,
my address and payment type, and just
about everything else. It’s easy to find
what I’m looking for and even easier
to buy and pay. They often ship free of
charge in a couple of days.
2. Ownership. I recently toured a
large Amazon fulfillment center, and
it didn’t look like a typical warehouse.
Items were stocked in random cubes.
Pickers received real-time electronic
instructions to pull items in close prox-
imity. Orders were assembled individu-
ally from items picked by many different
associates. Quality assurance was built
into the process.
3. Invent and simplify. Amazon
reinvented the customer experience.
Their value proposition is simple: Pur-
chase online at a low price, we ship it
20 Industrial Engineer | www.iienet.org/IEmagazine
By Paul Engle
to you promptly, and you can return it
for a full refund at any time. How could
anyone resist this offer?
4. (Leaders) are right, a lot. Ama-
zon expects staff to take risks and win.
Everyone knows that not all bets pay
off, but most do. The occasional wrong
is acceptable, and staffers who are right
most of the time are rewarded.
5. Hire and develop the best.
Amazon spends a great deal of resources
and effort developing staff members in a
Amazon expects staff
to take risks and win.
unique work environment. Most world-
class organizations share this culture of
investing in staffers, expecting a lot and
rewarding those who add value.
6. Insist on the highest standards.
In hundreds of purchases, I’ve never re-
ceived the wrong item or found some-
thing missing. Name one other retailer
with that track record.
7. Think big. Amazon could have
focused on being an online bookstore.
Instead of inventing the new business
called cloud computing, it could have
told young Silicon Valley startups that
it wouldn’t share new technology with
others. Instead, Amazon took enormous
risks and succeeded.
8. Bias for action. Amazon imple-
ments new products and features con-
tinuously. Staff is encouraged to grow,
expand and improve constantly.
9. Frugality. Amazon’s culture dif-
fers significantly from its peer group.
Google, Apple and Facebook offer gen-
erous perks like free transportation to
and from work. Amazon has avoided
these types of expenses and still man-
aged to attract top staff.
10. Learn and be curious. Staffers
are encouraged to investigate and think
creatively.
11. Earn trust. Trust sets you apart
from your peers. Amazon’s cus-
tomers trust that the company will
fulfill its promises. Team members
trust the company’s leadership.
12. Dive deep. Understanding
issues at a fundamental level im-
proves success rates.
13. Have backbone, disagree and
commit. Proposals must withstand
relentless vetting by staff before being
implemented.
14. Deliver results. Amazon earned
an enviable reputation for customer
service and profitable growth. Good
ideas were not sufficient – success was
required.
Amazon’s successful approach de-
mands high levels of performance to
support its stakeholders. 
Paul Engle is a management consultant
with an MBA in finance. He has more
than 30 years of experience in management,
operations, product development, sales and
marketing, strategic planning and business
process improvement. You may contact him at
paulfengle@outlook.com.
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