A Culture of Decision-making@Scale | Lessons from Amazon—a Series on Building Culture at Scale
This series explores scaling culture by looking at the impact on Behaviors, Processes, and Practices that support successful outcomes in Decision-making, Accountability, and Innovation.
There are several successful cultural practices at Amazon that lead to a high-quality, fast-paced decision-making culture.
Behaviors
Amazon’s Leadership Principles focus on behaviors and include practical examples. For decision-making, there are four key leadership principles:
The Leadership Principles work in synergy. For example, balancing Dive Deep with Bias for Action involves determining when to proceed with available information or when deeper analysis is necessary. Frameworks like One-Way Door vs. Two-Way Door decisions, discussed below, help with this analysis.
Customer Centricity is the #1 Decision-making Value
I believe the most important value is customer centricity and it has become common in company values. Apple's mission is “to create technology that empowers people and enriches their lives.” A Microsoft value is customer obsession. The Google values shared in Ten Things we Know to be True included “focus on the user and all else will follow.” The Ten Things also includes “fast is better than slow,” like Amazon’s Bias for Action.
Processes
Hiring Process
Amazon uses a highly structured process to select people who can contribute to decision-making success. A critical component is integrating Amazon’s cultural values in the end-to-end hiring process. Each interviewer assesses two leadership principles, and summarizes their feedback in an easy-to-use system reviewed post-interview. This ensures that Leadership Principles are active for both the candidate and the interviewer.
Andon Cord - Empowering Employee Decision-making
The Andon Cord, derived from a Japanese term for a paper lantern, empowers employees to stop production and alert management of significant issues. At Amazon, this principle allows customer service agents to pull an "Andon Cord" to address product issues. This empowers employees and reinforces Customer Obsession by ensuring that customer problems are addressed.
Legendary customer service cultures like Southwest Airlines, Zappos and Nordstrom applied similar policies, empowering their customer service employees to make decisions and solve problems on behalf of customers. Empowering employees is a powerful tool. One of Gallup’s 12 Drivers of Engagement is “at work, my opinions seem to count.”
Narrative Writing for Better Decision-making
Amazon's policy of no PowerPoint presentations in meetings and the use of six-page narratives is well known. Writing promotes thorough analysis and clear communication, which are critical for decision-making. Jeff Bezos' email to his senior team on June 9, 2004, initiated this change, emphasizing that PowerPoint presentations often gloss over ideas and fail to show the interconnectedness of concepts.?
Developing strong writing skills in leaders has become increasingly important, and narrative experts at Amazon coach and develop these skills in leaders. Amazon encouraged narrative experts like Christine Den Herder to coach and develop writing skills in leaders.
Robert Glazer's company adopted narratives over PowerPoints, and it surprised him how quickly leaders at his company adapted. He listed the top five benefits.
“As we have extended the use of memos out across the organization, the advantages have become increasingly clear. Here are the top five benefits we have seen so far.”
Read more about the benefits in I Tried Jeff Bezos's PowerPoint Replacement at My Company--and It Actually Worked
Use Narrated PowerPoint Videos to Improve Information for Decision-making
For organizations where adopting narratives is too drastic, narrated PowerPoint videos can provide better information for decision-making. These videos are easy to create and use as pre-reads or as a starting point for discussions.
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Practices
Data-Driven Decision-making
Successful companies like Amazon, Microsoft, Apple, Facebook, and Google use data-driven decision-making processes. At Google, data is the Holy Grail for optimizing decisions and finding new opportunities. Brandi Marcene in " An Insider’s Look: Google’s Organizational Culture and What Companies Can Learn from It" said this about Google’s culture:
At Google, data is the Holy Grail that can optimize decisions around a task or project. Google sees past optimal processes and interprets data to find new opportunities. From automating processes to creating meaningful dialogue, Google never lets an opportunity slip and believes in proactive employee engagement to build effective teams.
Working Backwards
The Working Backwards process involves answering five Customer Questions before developing solutions:
1. Who is the customer?
2. What is the customer problem or opportunity?
3. What is the most important customer benefit?
4. How do you know what customers need or want?
5. What does the customer experience look like?
Templates for the Working Backwards process are available to all Amazon employees.
Document Review Meetings?
Doc Review meetings make narratives more powerful by structuring meetings for meaningful feedback. A typical meeting involves reading the narrative in silence, followed by a discussion to build on the initial idea and shape a future vision that excites the customer.
Two-Way/One-Way Door Decisions
To speed up decision-making, Amazon differentiates between one-way and two-way door decisions. One-way doors are consequential and irreversible, requiring careful deliberation. Two-way doors are reversible and can be made quickly by high-judgment individuals or small groups.
Two Pizza Teams
To foster agility, Amazon uses the “two pizza rule.” Teams should be small enough to be fed with two pizzas. Small teams increase accountability and are easier to manage, allowing for efficient collaboration and effective contribution towards shared goals.
?Build Intentional Decision-making into Your Culture
Create a framework for decision-making that is accessible at every level of your company. Fostering decision-making expertise will foster a high quality, fast-paced decision-making culture that can succeed in a rapidly changing environment.
?A Data-Driven Conclusion
Do these cultural elements translate into results? MIT Sloan and Glassdoor’s Culture 500 data provide insights into how culture impacts outcomes. Agility is a strength for companies like Facebook and Amazon. At Amazon, the synergy of behaviors, processes, and practices forms the scaffolding for embedding better decision-making in the culture.
Good decisions are essential for success. Holding teams accountable for outcomes is another crucial component.
So, how does your company approach decision-making? Please share your insights in the comments.
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ChatGPT was used to revise this article
#Culture@scale, #companyculture #leadershipdevelopment
Associate Director, Sr. P&O Transformation Lead Partner
8 个月Thanks for sharing Robin, great observations and refreshing perspectives! I would like to add in addition to a "bias for action" the lens of being "solutions oriented". Often seeking to truly understand through asking questions.
Global Leadership Development Specialist | 20+ Years Designing High-Impact Learning Programs Across 26 Countries | Business Goals Focused Approach | High Performance Coach
8 个月I really like the overview of the narrative approach , over use of (sometimes very bad) PowerPoint . Also one and two way doors . Thanks for sharing
Author | Global Speaker and Facilitator
8 个月Thanks for the shout out, Robin! I have stayed at Amazon so long because of their culture of innovation and, of course, for the writing!
Innovative Product Strategist | People Leader | Developer Experience | Merging Product Expertise with Human Insight
8 个月Thanks for the mention in this really interesting article. There is so much to take from Amazon's operating model and their ability to remain truly agile and innovate/iterate quickly.