The Everything Store is a book about Amazon, the world’s largest e-commerce store, online marketplace, AI assistant provider and cloud computing platform.
It is also about Jeff Bezos, the founder, CEO and chairman of Amazon, and the world’s richest man.
I didn’t originally like this book. It tried to tread between Amazon’s history and Jeff Bezos’ biography, which resulted in a book that couldn’t cover both topics in deep detail.
Admittedly, it is difficult to separate the two, as Bezos himself is akin to the metonym of Amazon.
That said, this is still a wonderful look into the inner workings of both Amazon and Jeff Bezos’ mind. And this is probably the closest we can get, since Bezos controls the media narrative pretty tightly.
Without further ado, these are my biggest takeaways from the book.
Why Amazon is different from other companies
“If you want to get to the truth about what makes us different, it’s this.” Bezos says. “We are genuinely customer-centric, we are genuinely long-term oriented and we genuinely like to invent. Most companies are not those things. They are focused on the competitor, rather than the customer.
They want to work on things that will pay dividends in two or three years, and if they don’t work in two or three years they will move on to something else. And they prefer to be close-followers rather than inventors, because it’s safer.
So if you want to capture the truth about Amazon, that is why we are different. Very few companies have all of those three elements.”
How Amazon conducts meetings
“PowerPoint slides or slide presentations are never used in meetings. Instead, employees are required to write six-page narratives laying out their points in prose, because Bezos believes doing so fosters critical thinking.”
How Amazon creates new products
“For each new product, they craft their documents in the style of a press release. The goal is to frame a proposed initiative in the way a customer might hear about it for the first time. Each meeting begins with everyone silently reading the document, and discussion commences afterward.”
Jeff Bezos’ view of customer service
“Bezos hated when customers called, seeing it as a defect in the system, and he believed that customers should be able to solve their problems themselves with the aid of self-help tools. When they did call, Bezos wanted their queries answered promptly and their issues settled conclusively.”
Interestingly, this seems to be the modus operandi of many big tech companies today.
Jeff Bezos’ (now-famous) regret-minimization framework
This was the framework he used to justify leaving his high-paying job at D.E. Shaw & Co., a hedge fund.
“When you are in the thick of things, you can get confused by small stuff. I knew when I was eighty that I would never, for example, think about why I walked away from my 1994 Wall Street bonus right in the middle of the year at the worst possible time. That kind of thing just isn’t something you worry about when you’re eighty years old. At the same time, I knew that I might sincerely regret not having participated in this thing called the Internet that I thought was going to be a revolutionizing event. When I thought about it that way… it was incredibly easy to make the decision.”
This is a mental model I have (somewhat) incorporated into my life. I’ve used variations of this framework to make decisions and clear doubts in the past.
A variation I’ve used (and taught to me by my previous boss, Dave):
“Would you remember this in five years’ time?”
I honestly attribute this particular mental model in helping me curb my anger tendencies. If I am angry or feel frustrated at someone or something, I ask myself this question.
95% of the time, the answer is no, I won’t remember this at all. And I calm down after that.
Jeff Bezos’ view of team communications
“Communication is a sign of dysfunction. It means people aren’t working together in a close, organic way. We should be trying to figure out a way for teams to communicate less with each other, not more.”
Jeff Bezos’ infamous two-pizza teams
How internal teams in Amazon worked:
“Employees would be organized into autonomous groups of fewer than ten people — small enough that, when working late, the team members could be fed with two pizza pies. These teams would be independently set loose on Amazon’s biggest problems. They would likely compete with one another for resources and sometimes duplicate their efforts, replicating the Darwinian realities of surviving in nature.”
Why Apple sucked at books and Amazon sucked at music
“Bezos’s colleagues and friends often attribute Amazon’s tardiness in digital music to Bezos’ lack of interest in music of any kind. Steve Jobs, on the other hand, lived and breathed music. He was a notoriously devoted fan of Bob Dylan and the Beatles and once dated singer Joan Baez. Jobs’ personal interests guided Apple’s strategy. Bezos’s particular passions would have the same defining impact at Amazon. Bezos didn’t just love books — he fully imbibed them, methodically processing each detail.”
It is very interesting to see how the passions of a founder can drive the success of a company in a niche.
It’s also important to note that Steve Jobs was not a big reader.
How Jeff Bezos thinks
“Jeff does a couple of things better than anyone I’ve ever worked for,” Dalzell says. “He embraces the truth. A lot of people talk about the truth, but they don’t engage their decision-making around the best truth at the time. The second thing is that he is not tethered by conventional thinking. What is amazing to me is that he is bound only by the laws of physics. He can’t change those. Everything else he views as open to discussion.”
Rick Dalzell was the chief information officer and senior vice president of Amazon from 1997 until November 2007.
One of Amazon’s leadership principles: “disagree and commit”
“Bezos abhors what he calls “social cohesion”, the natural impulse to seek consensus. He’d rather his minions battled it out in arguments backed by numbers and passion, and he has codified this approach in one of Amazon’s fourteen leadership principles:
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.”
On how Amazon Prime came about
“Bezos felt that word of mouth could deliver customers to Amazon. He wanted to funnel the saved marketing dollars into improving the customer experience and accelerating the flywheel. And it happened at the time, Amazon was conducting an experiment that was actually working this way — free shipping.
In early 2002, Bezos called a meeting in Warren Jenson’s conference room to talk about how to turn the holiday-season free shipping into a permanent offer. This was one way he could redeploy his marketing budget. Jenson was opposed to this.
Then, one of his deputies, a finance vice president named Greg Greeley, mentioned how airlines had segmented their customers into two groups — business people and recreational travelers — by reducing ticket prices for those customers who were willing to stay at their destination through a Saturday night.
They would make the free shipping offer permanent, but only for customers who were willing to wait a few extra days for their order.
Just like the airlines, Amazon would, in effect, divide its customers into two groups: those whose needs were time sensitive and everyone else.”
Ideas don’t have to come from your industry. Ideas can come from anywhere. Ideas from one area will look completely fresh in another.