Managing Partner at NorthBailey. Having had senior marketing & insight roles at Tesco, Sainsbury's, Asda, Coop and M&S, I'm now using my experience & network to solve strategic marketing problems for NorthBailey clients
As consumers talk about the cost of living crisis, now is the time to focus on growth . Revenue growth is a critical driver of corporate performance. Consistent revenue growth is difficult to deliver but a “growth code” can give you focus.
Put competitive advantage first. Start with a winning, scalable formula.
Make the trend your friend.Prioritize profitable, fast-growing markets.
Don’t be a laggard. It’s not enough to go with the flow—you need to outgrow your peers.
Turbocharge your core. Focus on growth in your core industry—you can’t win without it.
Look beyond the core. Nurture growth in adjacent business areas.
Grow where you know. Focus on growing where you have an ownership advantage.
Be a local hero.Commit to winning on the home front.
Go global if you can beat local. Expand internationally if you have a transferable advantage.
Acquire programmatically.Combine healthy organic growth with serial acquisitions.
It’s OK to shrink to grow. Ruthlessly prune your portfolio if you need to.
“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 letter to shareholders 2016
Takeaway
Companies that get complacent die.
Bigger companies are even more at risk because growth and scale make it harder to move quickly when you spot an opportunity.
To stay alive, big companies must strive to make decisions and act faster than startups.
Challenge
At Amazon, it is always Day 1— it’s a powerful refrain that has featured in every shareholder letter since the original.
Day 1 represents originality, enthusiasm, and an eagerness to delight customers.
Day 2, for Bezos, is a powerful concept that embodies everything he fears could happen to Amazon and that does happen to many large organizations.
It is the idea that all of the tools you used to grow, all of the processes you used to scale, and all of the work you did to get to where you are become the company’s undoing. People get stuck in their processes.
Day 2 is the failure to adapt. And the bigger an organization gets, the harder it needs to work to stave off complacency.
Solution
measure yourself by your customers. They are always “beautifully, wonderfully dissatisfied,” in Bezos’ words, and if you focus on always trying to make them happier, it’s hard to go wrong.
Bezos warns against allowing process to turn into proxy. When you abstract a task into a process, it’s easy to start managing to the process rather than to the outcome you want. Soon, you have people getting the wrong end result and justifying their actions by saying they “followed the process.”
Bezos suggests that you always keep one eye on the outcome, not whether someone has ticked off every box on a list of steps.
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all. Links to all letters to shareholders
1997: Bring on shareholders who align with your values
Bezos recognised failure and invention are inseperable twins: to remain i
“Some decisions are consequential and irreversible or nearly irreversible – one-way doors — and these decisions must be made methodically, carefully, slowly, with great deliberation and consultation. . . . But most decisions aren’t like that — they are changeable, reversible — they’re two-way doors. . . . [These] decisions can and should be made quickly by high judgment individuals or small groups.”
Takeaway
Big companies stop being creative because, in large part, their decision-making processes become slower and more drawn out as they scale. Caution creeps in, and people are less likely to move quickly or place risky bets.
For Bezos, the problem is that people treat reversible decisions like momentous problems requiring caution. They miss opportunities that nimbler companies don’t.
To remain innovative as you grow, you need to understand which decisions are reversible and should be executed on quickly, and which have lasting consequences and should therefore be mulled over more slowly.
Challenge
Big companies are less tolerant of failure because they have more to lose, especially if they are public and have shareholders. Companies say they want to remain innovative, but they’re often not willing “to suffer the string of failed experiments necessary to get there.”
But it’s a mistake to take the overly cautious approach. “Every once in a while, when you step up to the plate, you can score 1,000 runs,” Bezos writes.
The key is figuring out how to marry the innovative spirit with the reality of risk aversion that exists at any large organization.
Solution
Amazon’s success, according to Bezos, is rooted in the company’s acceptance of risk.
“I believe we are the best place in the world to fail,” he writes, “and failure and invention are inseparable twins. To invent you have to experiment, and if you know in advance that it’s going to work, it’s not an experiment.”
The way Amazon achieves its risk acceptance mentality, according to Bezos, is through acknowledging which decisions can be easily reversed (and should therefore be decided on by small, fast-moving teams) and which cannot (and should therefore be more carefully considered).
“Failure and invention are inseparable twins.”
He refers to these as two different types of decisions, Type 1 and Type 2.
Type 1 decisions are almost impossible to reverse. They’re “one-way doors.” Type 2 decisions, on the other hand, can easily be reversed. They’re “two-way doors.”
Type 1 decisions should be made slowly and with caution, and Type 2 decisions should be executed quickly.
Mistaking Type 2 decisions for Type 1 slows the team’s pace. It leads to unchallenged risk aversion. And, in the end, it means less innovation.
Bezos’ advises to figure out what types of decisions your organization is making and treat them accordingly. Don’t treat lighter Type 2 decisions like Type 1 decisions. When you know you can reverse the outcome if you don’t like it, don’t get too mired in details and projections (no one will know the outcome until it actually occurs), and don’t let the project suffer death by committee. Just execute.
Jeff Bezos letter to shareholders 2015
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.link to all letters to shareholders
1997: Bring on shareholders who align with your values
“A dreamy business product has at least four characteristics. Customers love it, it can grow to very large size, it has strong returns on capital, and it’s durable in time—with the potential to endure for decades. When you find one of these, don’t just swipe right, get married.”
Takeaway
Be aggressive about placing bets on dreamy business ideas. You’ll have failures, but sufficiently big winners will more than make up for all of your failed experiments.
Challenge
Many relationships, particularly business ones, require bold moves to get going. And to find true success, you have to commit for the long haul. The problem is that these moves don’t just appear risky — often, they’re hard to rationally justify at all.
When your risk tolerance is high, you can make bets all over the map.
Organizations that want to make data-driven decisions often have a difficult time with placing risky bets because those bets often don’t have clear quantitative evidence to support them. If they did, there wouldn’t be a risk of failure, there wouldn’t be experiments, and there wouldn’t be such a big upside.
Solution
Place your bets where your downside is capped but your upside is unlimited.
For Bezos, the best bets are on dreamy businesses. You know you have a “dreamy” business idea when:
Customers love it
It has the potential to become very large
It has the potential of very strong returns
It has the possibility to endure
Each of the three major bets that Bezos mentions in this letter — Marketplace, Amazon Web Services (AWS), and Prime — was a risky idea.
With Prime, for example, no one on the Amazon team could point to numbers showing that giving customers free shipping for a yearly fee would ever pay for itself.
Today, each of these three bets is a pillar of Amazon’s business. In fact, in 2017, all of Amazon’s operating income came from AWS, a once-risky bet on a “dreamy” business idea. With almost $17.5 billion in sales in 2017, and about $4.5 billion in profit, it was Amazon’s second-largest source of revenue.
Not every bet that Amazon has ever placed has succeeded. The company was a significant shareholder in both Pets.com and living.com, for example. They lost their investment, but stood to gain so much more if they turned out right.
Jeff Bezos letter to shareholders 2014
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
Any one who has children knows you are never really in control….
but getting more control at work is important. We’ve all been in meetings — especially virtual ones — that feel like they’re going off the rails. People are trying to get a word in and may be inadvertently, or intentionally, talking over one another.
Be prepared to step in when this happens. You can constructively cut in by using a filler word to drive a strategic wedge into the conversation.
Contrary to popular belief, words like “um” and “you know” can actually be useful in this context. When body language and silent cues can be harder to read, these words can indicate to the group that you’d like to say something. Then, once you have the floor, compliment and build on someone else’s point, even if you don’t necessarily agree with it.
For example, you might say, “That’s a great point, I’d like to add to that.” Or, “I really appreciate this discussion — it makes me think about XYZ.” This way, you can maintain everyone’s credibility while also creating an opportunity to get the conversation back on track.
“We have the good fortune of a large, inventive team and a patient, pioneering, customer-obsessed culture — great innovations, large and small, are happening everyday on behalf of customers, and at all levels throughout the company. This decentralized distribution of invention throughout the company — not limited to the company’s senior leaders — is the only way to get robust, high-throughput innovation.”
Takeaway
Innovation comes from distributed decision-making. Top-down teams are effective at optimizing existing processes and enforcing the completion of work, but only decentralized, bottom-up teams can consistently generate new ideas.
Challenge
In most big companies, command-and-control is the way that work gets done. Ensuring that important decisions only get made by those at the top maintains a certain level of quality and keeps everything stable.
Building a business that is continuously throwing off new ideas and innovating, on the other hand, requires that your people have leeway. You need autonomous teams that can exercise their own judgment rather than having to submit every idea they have to a committee. It requires your company to recalibrate how it hires, how it takes risks, and the opportunity it offers to even junior employees.
Solution
Its culture of creativity is a large part of why Amazon has been so successful on so many fronts, and why it has risen to the second-largest company by market cap in the world.
That creativity is often actually a function of the proactive way Amazon thinks about customers. Rather than wait for their customers to tell them about something they want, Bezos says, Amazon would always rather create the thing they don’t even know they want yet.
To encourage this kind of innovation inside your company, however, you need to have distributed decision-making and autonomy for more than just your senior staff.
At Amazon, employees who have an idea are encouraged to pursue it, even if they have to upset traditional corporate rules to do it.
Great innovations come from a “large, inventive team” with a “patient, pioneering, customer-obsessed culture” rather than from a small braintrust.
If you’re a junior employee at Amazon and you have an idea for some new way to delight customers, Bezos writes, you’re just as encouraged to give it a try as a senior leader. Experiments can start small. The downside of a small failed experiment is low, but the potential upside can be very high.
Jeff Bezos letters to shareholders
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
When work is intense, it’s easy to beat yourself up for letting things slip at the office or at home.
But doing so can make the stress worse.
Have self-compassion instead: Accept that you’re in an acute period of work stress and notice — don’t suppress or deny — your emotions.
Assigning a word to what you’re feeling, such as “pressure,” “guilt,” or “worry,” can activate the prefrontal cortex, which is responsible for executive functioning skills.
Assess your to-do list by deciding what you need to get done each day and what can wait.
Don’t be afraid to ask for help, whether it’s renegotiating a deadline with a colleague or getting family members to pitch in at home.
Having compassion for yourself will help you increase your focus and get through the crunch with greater ease and peace.
“When we’re at our best, we don’t wait for external pressures. We are internally driven to improve our services, adding benefits and features, before we have to. We lower prices and increase value for customers before we have to. We invent before we have to.”
Takeaway
In the short term, spending money to deliver value above what your customers could reasonably expect looks foolhardy — in the long run, it could be your competitive advantage.
Proactively bringing value to your users and delighting them builds attachment and trust. Build enough of it, and you create a connection with your customers that becomes hard to break.
Challenge
On Wall Street, delivering value above and beyond what your customers expect is not considered a sensible decision — especially if it costs money. One early critic of Amazon derisively described the company as a “charitable organization being run by elements of the investment community for the benefit of consumers.” This kind of attitude has become so pervasive that for many businesses, it’s seen as safer to move in lockstep with your competitors, never falling behind but never advancing ahead of them either.
Solution
Building a great customer-centric business over the long-term doesn’t happen when you’re only reacting to your competitors.
Proactively delighting your users costs money, but it pays off when you distinguish yourself — your customers stick around for longer and they pay you more.
The longer a company is able to retain its customers, the less it needs to spend on acquisition or marketing. The more revenue it drives from each customer, the stronger its business.
For Amazon, building a high lifetime value among its customer base through proactive delight has been a powerful differentiator. The average lifetime value of a Prime customer was estimated at $2,500 in 2017, well over the $150 average in e-commerce.
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
“I am emphasizing the self-service nature of these platforms because it’s important for a reason I think is somewhat non-obvious: even well-meaning gatekeepers slow innovation. When a platform is self-service, even the improbable ideas can get tried.”
Takeaway
A platform that other people can use to generate value will always be more powerful than a controlled, walled garden that you control and populate with your own content.
Incentivize people to use your self-service platform, and you can build a much larger business than you could even as a well-meaning gatekeeper.
Challenge
The main impediment to platform creation today is technology. Companies that do not invest in technology that can turn their work into a platform are going to fall behind.
Solution
Amazon has disrupted traditional publishing similarly to how it disrupted traditional retail: by building a platform for other people to use to sell their wares.
In publishing, agents and editors decide what is quality and what’s not. They only have the resources to produce and market a certain number of books every year, so they can’t publish everything that comes across their desks.
With Kindle Direct Publishing, authors can set their own list prices for written work, control their rights, and get their books in front of readers around the world in less than 48 hours. No gatekeeper needed.
Amazon provides the same type of self-service platform for internet companies through AWS and merchants via Fulfillment by Amazon. “These innovative, large-scale platforms are not zero-sum — they create win-win situations and create significant value for developers, entrepreneurs, customers, authors, and readers,” and of course, Amazon.
Jeff Bezos letter to shareholders
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
“And while many of our systems are based on the latest in computer science research, this often hasn’t been sufficient: our architects and engineers have had to advance research in directions that no academic had yet taken. Many of the problems we face have no textbook solutions, and so we — happily — invent new approaches.”
Takeaway
Software is eating the world, and that means that technology should infuse everything that you do as a company, no matter your core competency.
With the speed at which technology advances and improves, investing in becoming a tech company will let you move much faster than your competition.
Challenge
Shareholders, executive teams, and boards aren’t always aware of the most up-to-date advances in infrastructure technology, machine learning, and software architectures. It’s not necessarily easy to explain why you’re doing your own cutting edge research on these kinds of topics rather than focusing on your company’s main line of business.
Solution
You can’t expect to progress technologically if you’re siloing your company’s technology work in some kind of R&D department, Bezos writes.
At Amazon, technology pervades everything — every process, every decision, and every businesses.
Because of this approach, it can point to any product or line of business in the company and show how its dominance is rooted in technology, from the site’s search engine to Kindle.
Even Amazon Web Services — today one of Amazon’s main pillars and its largest driver of profit — was born from a piece of internal technology.
Technology isn’t just something that Amazon invests in so it can keep up with their competition. It’s how it tries to make core products better.
Jeff Bezos letter to shareholders
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
Leading an organizational transformation is hard, learnt many lessons as Customer Director through the Coop rescue.
If you’ve got a major change on the horizon (or if you’re currently leading one that’s stuck in a ditch), you need to be aware of three common pitfalls — and how to avoid them.
Don’t underestimate the scope of the work. Executing a transformation at scale typically requires more time and coordination than leaders expect. To counter this, make sure you have realistic expectations. Take an incremental approach to the overall goal by launching a series of small-scale projects and initiatives led by distinct teams. And be sure that all of these related initiatives — and the people who lead them — are aligned, communicate effectively, and avoid taking on overlapping or conflicting work.
Don’t overestimate your colleagues’ capacity to execute your vision while continuing to carry out their existing day-to-day responsibilities. Listen for feedback about their ability to deliver. Be ready to adapt accordingly.
Don’t hide why this transformation is important . Be transparent and express why you believe the organization should move in this new direction. You want to be a leader who inspires trust throughout the transition.
“Senior leaders that are new to Amazon are often surprised by how little time we spend discussing actual financial results or debating projected financial outputs. To be clear, we take these financial outputs seriously, but we believe that focusing our energy on the controllable inputs to our business is the most effective way to maximize financial outputs over time. . . . Our goal-setting sessions are lengthy, spirited, and detail-oriented. We have a high bar for the experience our customers deserve and a sense of urgency to improve that experience.”
Takeaway
When you’re setting goals for a business or a product, focus on controllable inputs, not on financial outputs.
Over the long term, investing your effort in the parts of the customer experience that you can control is what generates success for your company financially.
Challenge
The majority of large, public companies benchmark success by quarterly and annual financial results. They know their boards will assess them using these numbers, so they focus their teams on hitting financial goals. The problem is that incentivizing a team to hit certain numbers doesn’t always incentivize them to do the right things for their customers.
Solution
Instead of setting goals and judging your company’s efforts using financial outputs, work on perfecting your inputs, and trust that the outputs will handle themselves.
In this letter, Bezos mentions several key inputs he and his team assessed throughout 2009, including:
The # of reviews added to Amazon products
The # of new product categories available
The # of different items available for immediate shipment on Amazon PrimE
1. The more reviews added to Amazon products, the better a new customer’s understanding of whether that product is worth buying or not, and the more trust they can place in the platform.
2. The more product categories and products available the more likely customers are to use amazon as go-to retailer.
3. The more items available for immediate shipment on Prime, the more choice a customer has, and the less likely they are to go somewhere else to find an item the next time.
If you can choose inputs that correlate with a great experience for your customers, then working on those will likely bring financial outputs up over the long-term.
Jeff Bezos letter to shareholders
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
most leaders are too focused on having all the answers — and not focused enough on asking the right questions.
It’s time to recalibrate.
Despite what you might think, expressing vulnerability and asking for help, clarification, or input can be a sign of strength and confidence, not weakness.
The right questions are signals of trust — and they can inspire people to trust you in return.
For example, rather than telling your team about a new opportunity you’ve identified, ask them, “Do you see a game-changing opportunity that could create much more value than we’ve delivered in the past?” A big, simple question like this can inspire a burst of collaboration and creativity across the organization.
And if you consistently demonstrate a question-first mindset, you’ll help establish an overall culture of curiosity and learning that will keep your team innovating and responding to challenges effectively.
So try it out this week: Ask your team a big-picture, open-ended question, and see if it doesn’t lead to some new and exciting ideas
“’Working backwards’ from customer needs can be contrasted with a ‘skills-forward’ approach where existing skills and competencies are used to drive business opportunities. The skills-forward approach says, ‘We are really good at X. What else can we do with X?’ That’s a useful and rewarding business approach. However, if used exclusively, the company employing it will never be driven to develop fresh skills.”
Some companies figure out what to build next by thinking about what they’re already good at doing today — a good approach in some cases, Bezos says, but not always.
If you want to delight and amaze your customers and develop fresh lines of business, you need to think backwards from what your customers need.
Challenge
As a company, it’s more straightforward to rely on a skills-forward approach. Over time, you develop expertise in certain fields. Deciding what to do next based on the expertise you’ve already developed is often a good way to leverage your competence in one area into new successes.
The problem is that this method will never bring you new skills or capabilities. You’ll never learn how to do new things, and that will ultimately hurt your ability to innovate.
Solution
To take your business to the next level, start by thinking about what your customers want or need, and work backwards to figure out what you can build.
When the Kindle project started, the vision was simple — the capability for any book ever printed to be accessed in less than 60 seconds. That was it: the product was no more determined than that.
Although Amazon had never built a hardware device before, the team focused on fulfilling that vision. They hired people with the right skills to engineer that vision, rather than trying to create a product better suited to Amazon’s existing skills.
The Kindle software and hardware emerged organically out of the Amazon team’s attempt to answer that product vision, and the result became another powerful arm of Amazon’s business.
Thinking backwards from customer needs rather than seeking the path of least resistance at each juncture allows Amazon to be both successful and creative. That’s what has allowed them to reinvent the company time and time again.
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
It can feel like 24 hours isn’t enough time in the day, and all the productivity hacks in the world won’t change that. Here are four proven strategies to help you make the most of your limited time.
Batch your emails and meetings. It’s hard to get into flow when you know you’re going to be interrupted every hour. By knocking out all your emails or meetings at once, you’ll clear out some undisturbed time to work on deep-focus tasks.
Do your best to learn some keyboard shortcuts that can reduce how much you rely on your computer’s mouse and trackpad. This may seem like a small thing, but over time, it makes a huge difference.
Nudge your way to better behaviour: Leverage your environment to change your self-destructive habits. If you’re losing time because you’re distracted by your phone throughout the day, leave it in another room. If emails are derailing your workflow, pause notifications.
Read your work out loud. No matter what your job is, chances are you write at least one email per day. Listening to the words you put down on paper will speed up and clarify your writing process.
“We started by setting ourselves the admittedly audacious goal of improving upon the physical book. We did not choose that goal lightly. Anything that has persisted in roughly the same form and resisted change for 500 years is unlikely to be improved easily. At the beginning of our design process, we identified what we believe is the book’s most important feature. It disappears. When you read a book, you don’t notice the paper and the ink and the glue and the stitching. All of that dissolves, and what remains is the author’s world.”
Takeaway
When you’re trying to build something totally new, hire missionaries.
Missionaries — people who are passionate and empathetic about products — are always going to be better equipped to disrupt existing incumbents.
Challenge
Many everyday products and systems we take for granted are, in one way or another, “good enough.” Physical books, taxi cabs, hotels — they get the job done, even if they can be seen as outmoded, archaic institutions.
With these kinds of institutions, inertia sets in. Getting people to adopt a new habit or start using a new product when they’re accustomed to using something “good enough” is a very difficult task.
Solution
Missionaries are people who understand the appeal of the old ways. They understand why the “good enough” product is “good enough,” and because of that, no one else is better positioned to disrupt that business than them.
Bezos calls back to the original launch of Amazon, when people believed an online bookstore needed to have all the features of a physical book stores. Critics asked him how they would do “electric book signings.”
Barnes & Noble’s stock price.
The Amazon team didn’t know. They did know that they could provide far greater value than physical bookstores in at least one area, by offering millions of different titles and thousands of different customer-submitted reviews.
With the Kindle, the team of missionaries at Amazon knew that the sentimentality of the book was strong. After all, books have been around in the same form for hundreds of years. In trying to build a “better book,” they knew they had to emulate the best aspects of the book.
One of the best aspects of a physical book, they realized, was that books get “out of the way.” The Kindle’s e-ink screen and fast page switching emerged directly from the realization that they needed to make sure the interface got out of the way and let readers focus on their books. With missionaries building the product, Bezos said he believed the Kindle, would “‘start a fire’ and improve the world of reading.”
Amazon didn’t wipe Barnes & Noble’s off the map — as Amazon didn’t (and couldn’t) replace everything B&N does. Amazon could just do (and did) an exponentially better job at one of their more profitable core functionalities.
Jeff Bezos letter to shareholders
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
Between the health risks of the coronavirus, the economic stress of the recession, social distancing, and mandatory work-from-home arrangements, so much of our lives feel out of our control right now.
Research shows that anything you can do to restore your sense of autonomy — even in small ways — will help you be more resilient. Here are a few tips. Firstly if you’re working remotely, set up a comfortable and personal workspace.
You might define a clear boundary between “work” and “home” by telling yourself: When I’m in this room or wearing these headphones I’m “at work.”
Also, identify and embrace the perks of working at home. For example, if you no longer have a long commute, you can choose how you’ll spend that time — whether it’s getting an extra hour of sleep, being with your family or friends, or even delving into a new hobby. (Just try to resist the temptation to spend that time working.)
You can also reclaim control over your body and mind by prioritizing self-care. Investing time and attention in your own well-being is crucial during stressful times.
While the pandemic’s closures and restrictions may dictate many aspects of your life right now, how you customize your environment, spend your time and treat yourself is up to you.
Not every project or task you take on requires your immediate attention.
If you’re feeling overwhelmed, ask yourself a few questions to help you prioritize your to-do list.
why is this task necessary? If there’s no clear answer, it’s probably not urgent.
what would happen a month from now if you don’t get this done? It’s tempting to barrel through your list for the sake of crossing things off, but before you spend time on a task, visualize its future impact on you, your stakeholders, and your business. If you don’t see a long-term impact, consider passing.
are you the right person to do this task? If not, consider whether you can delegate to someone else.
did you agree to take on this task for the right reasons? You may have told yourself, “People will think I’m rude if I say no,” or “My direct reports are too busy to do this.”If you said yes for the wrong reasons, chances are you’re the wrong person for the Job
Don’t do every task: we’ve learnt in the recent health crisis that if you focus on the important things, that’s what matters
Let’s face it, continuous video calls are exhausting.
But there are a few things you can do to conserve your time and energy.
1. avoid multitasking. It may be tempting to try to get other work done while you’re listening in, but switching between tasks can cost you as much as 40% of your productivity.
2. cut down on distractions. Close your browser tabs, put your phone away, and stay present. You can take short breaks during longer calls by minimizing the video, or just looking away from your computer now and then.
3. Do you really need a video meeting? take a step back and ask yourself whether you even need a video meeting. Check your calendar to see if there are any conversations that you could have over Slack or email instead. don’t feel obligated to make every conversation a video call. Especially when you’re talking to people outside your organization, a phone call is probably just fine.
Taking these steps may feel hard at first, but they will help prevent you from feeling drained at the end of another workday.
“In some large companies, it might be difficult to grow new businesses from tiny seeds because of the patience and nurturing required. In my view, Amazon’s culture is unusually supportive of small businesses with big potential, and I believe that’s a source of competitive advantage.”
Takeaway
New business lines start out as seedlings. Often, they won’t meaningfully contribute to revenue for many years. But if you have the patience to nurture those seedlings, you can end up with powerful new revenue lines.
Challenge
Making long-term investments in small internal businesses can be difficult in a fast-paced corporate environment.
Large corporations are good at executing on predetermined strategies, but they struggle to slow down and give new business lines time to develop.
Public markets judge performance on a quarterly basis, and salaries, promotions, and layoffs also based on these figures. It is difficult to go against the grain and accept projects that might not see returns for some time (or at all).
Solution
While you need concrete insights and metrics to bet on a new idea, you also need patience and nurturing to make it thrive.
At Amazon, Bezos emphasizes that even if a new business enjoys runaway success, it will only begin to contribute meaningfully to company economics in three to seven years. Accepting that kind of time-frame as normal is the first step to building new innovative businesses inside your company.
Fulfillment by Amazon AWS and Amazon Advertising services , for example — now major winners for Amazon — began as seed investments.
Jeff Bezos letter to shareholders
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
If a brand is a promise, then the expectations people have of the brand are created by the promises we make. Meeting expectations is about the alignment of words and deeds.
Disappointment occurs when we don’t do what we say we’re going to do.
When we promise more than we can deliver or pretend to be something we’re not.
Ironically, we are the ones who are most disappointed when we don’t meet the standards we set. We have the power to change this, by prioritising building trust over making an impression and only setting the expectations we’re willing to live up to.
“Math-based decisions command wide agreement, whereas judgment-based decisions are rightly debated and often controversial, at least until put into practice and demonstrated. Any institution unwilling to endure controversy must limit itself to decisions of the first type. In our view, doing so would not only limit controversy — it would also significantly limit innovation and long-term value creation.”
Takeaway
Some decisions can be made with data, but many of the important business decisions can only be made with judgment.
Many opportunities with fantastic upside won’t make sense in the short-term — to identify these, you have to think about what makes the most sense for your customers.
Challenge
When opening a new fulfillment center or deciding how much of a product to hold in inventory, you can always look a existing data to figure out the option that will most improve the customer experience.
But huge, business-making improvements — like Amazon’s decision to create Amazon Prime — often don’t have clean math behind them. According to the models Amazon had at the time, Prime actually seemed like a terrible idea. Often, your best decisions will.
Solution
When trying to weigh personal instincts versus quantitative models, use the customer experience to tip the scales.
Decisions that make sense on paper but don’t improve the customer experience may have limited upside. Decisions that undeniably benefit your customers can have significant upside, and sometimes the potential upside is so big that it’s worth risking the numbers not working out.
When Amazon first considered a free shipping service like Prime, quantitative models pointed to raising prices on shipping, not to making shipping free. If it raised prices, the models said, the company probably wouldn’t lose that many customers and it would make a lot more money.
If Amazon had focused just on that data when deciding whether or not to introduce Prime, it would not have rolled out the service. But the team’s judgment was simple: if they kept lowering prices, it would lead to a greater volume of purchases, and ultimately that would mean greater customer loyalty over the long term. That bet paid off.
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
stay cool in a conflict leadership tip of week #135
Only Express Emotions During a Conflict If They’ll Help You Resolve It
When a disagreement with a colleague gets heated, it’s normal to feel all sorts of emotions: disappointment, anger, or frustration, for example.
But should you express what you’re feeling?
It depends. If you’re experiencing what psychologists call a hot emotion — one that comes with an urgent sense of entitlement or even revenge (“I have to tell him exactly how I feel!”), it’s better to find a way to calm down first.
If the emotion is cold, meaning you can control it and use it to help the situation (“I want to tell him how I feel so that he’ll understand my perspective”), then it’s probably OK to express it.
But don’t just name the emotion; explain what’s causing it. Telling someone you’re angry is less helpful than sharing that you’re disappointed they didn’t follow through on their commitment to you.
“Our ultimate financial measure, and the one we most want to drive over the long-term, is free cash flow per share. Why not focus first and foremost, as many do, on earnings, earnings per share or earnings growth? The simple answer is that earnings don’t directly translate into cash flows, and shares are worth only the present value of their future cash flows, not the present value of their future earnings.”
Takeaway
Prioritizing free cash flow will allow you to experiment and innovate quickly, as capital won’t be tied up in investments that could be irrelevant by the time they’re paid off. In today’s fast-moving business environment, this is essential to keep from falling behind.
Challenge
Many public companies prioritize metrics like earnings per share or earnings growth when benchmarking their performance. Media coverage, analyst reports, and public opinion all play a role in developing this focus, but it can be ultimately counterproductive for a large enterprise to concentrate on increasing its earnings, even when its primary obligation is to its shareholders.
As Bezos reminds us, “Earnings don’t directly translate into cash flows, and shares are worth only the present value of their future cash flows.”
Solution
The solution to building a financially durable and growth-ready company is to focus less on earnings, and more on free cash flow.
If you build a business with earnings growth but no free cash flow, it’s often a poor investment over the long term.
Structuring your business to prioritize free cash flow will look different from industry to industry, but Amazon does it in a few key ways:
The company turns over inventory quickly
It collects payments from customers before payments to suppliers are due
It minimizes its investment in its own inventory
Amazon maintains a cash generative operating cycle and can keep its investments in fixed assets low, at only 4% of all sales in 2004. Looking forward from 2004 to 2018 you can see how free cash flow has accelerated with sales and ahead of profit, allowing amazon to invest in innovation.
Jeff Bezos letter to shareholders
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
“Long-term thinking is both a requirement and an outcome of true ownership. Owners are different from tenants. I know of a couple who rented out their house, and the family who moved in nailed their Christmas tree to the hardwood floors instead of using a tree stand. Expedient, I suppose, and admittedly these were particularly bad tenants, but no owner would be so short-sighted. Similarly, many investors are effectively short-term tenants, turning their portfolios so quickly they are really just renting the stocks that they temporarily ‘own.’”
Takeaway
If you want to build a successful company for the long term, build a company of owners.
With the mentality of a service provider, you will seek short-term gains and sacrifice future growth.
With the mentality of an owner, you will always act in the best interests of your customers and your team. In the end, the work you do acting as an owner will coincide with the interests of your shareholders.
Challenge
It can be difficult to take a long-term view when Wall Street and other stakeholders tend to look for fast results. Doing the best thing for the long-term needs of your company doesn’t always coincide with the most expedient or profitable thing in the short term.
That’s because “many investors are effectively short-term tenants,” Bezos writes. Many investors are not looking for long-term success — they want dividends tomorrow.
But it’s not just a problem for investors: the short-term focus also tends to infect the people who run companies.
Thinking long term and building a successful growth company means getting out of that short-term investor mindset and thinking like an owner.
Solution
Taking a long-term view often requires deep consideration of your business model, and it doesn’t always make everyone happy.
When Amazon first started allowing customers to review their products, they got angry feedback from some vendors who asked why they allowed negative reviews on a site where profit came from sales.
For Bezos and the rest of Amazon, customer reviews were built with a long term goal in mind: that customers would trust Amazon to provide them with quality products and transparent information. Though negative reviews cost sales in the short term,” he writes, “helping customers make better purchase decisions ultimately pays off for the company.”
The same goes for Amazon’s pricing: “Our pricing strategy does not attempt to maximize margin percentages,” he writes, “but instead seeks to drive maximum value for customers and thereby create a much larger bottom line.”
Every decision that gets made at Amazon gets made through “the context of the customer experience.” They design it with long-term owners in mind. And in the end, they trust — and ask that their shareholders trust — that it will ultimately pay off.
Jeff Bezos letter to shareholders 2002
Jeff Bezos has been writing a letter to shareholders since 1997 and looking at all if them gives an insight to the organisation and a masterclass in leadership. This is a series of short blogs that gives you a snap shot / key takes outs of each letter, along with links to them all.
link to all letters to shareholders
1997: Bring on shareholders who align with your values
Data Pulses storytelling 