The Frugality leadership principle makes the reason very plain: “There are no extra points for headcount, budget size, or expense.” One clear downside to this approach is that other companies with deep pockets can try to hire away your best employees with big cash offers. It’s true, some employees leave for a short-term jump in their cash compensation. But on the positive side, Amazon’s approach reinforces the kind of culture it seeks to develop. Sometimes it is okay to lose people who have a short-term focus while retaining those who are in it for the long term.
