The Amazon Way Quotes

“Free Cash Flow as the Fuel for Business Strategy. Let us now assume that operations are running efficiently and FCF is being generated. As a leader, it is your responsibility to spend this cash in whatever way creates the most value for shareholders. Your options fall into four basic categories: Investing in growth Paying down debt Buying back shares Paying out dividends”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“In his 2004 Letter to Shareholders, Bezos explains the reason for Amazon’s focus on FCF: “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.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Live the leadership principles. Annual reviews factor in how well an employee “has lived up to the leadership principles.” This review metric requires employees to account for “how” they reached their goals while perpetuating and reinforcing the leadership principles as the company’s North Star. If you violate the leadership principles by failing to obsess over the customer, communicating vaguely, or failing to hire or develop a first-rate team or if you allow low standards, ignore details, or fail to “think big,” you won’t deliver the right results.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Promotions are heavily scrutinized. They require multi-page written documents with hard evidence rationalizing the promotion. They must be debated and read all the way up the chain of command to the CEO. These promotion documents can also be audited to ensure claims are not inflated. Finally, every year, Amazon terminates five to eight percent of the organization for not reaching the required standards of excellence.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Amazon’s performance management philosophy is rooted in three principles: 1) A BIG difference exists between “A” and “B” performers. As a result, “A” performers receive a majority of the company’s compensation rewards, primarily in the form of stock.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Leaders who think like owners are crucial to this process because you don’t want people who prioritize short-term results at the expense of long-term enterprise value. When organizations prioritize output financial goals, they often sacrifice the big picture. As a result, it’s important to debate and coordinate annual goals more intensely than ever before.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Amazon has a deep belief in setting goals that stretch teams and individuals but defining them in a way that puts the team in control of hitting these lofty goals. This empowers teams and stretches them to great achievements. Of course, many of the goals have a direct customer experience component and rarely are they revenue-oriented. “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,” wrote Bezos. “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.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“As Bezos noted in a 2012 interview with Charlie Rose, “When you have to write your ideas out in complete sentences and complete paragraphs, it forces a deeper clarity of thinking.”82 Narratives force clarity, prioritization, and accountability to deliver, and they force your audience to understand at a deeper level.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Ah! And there we have it. Finally, after starting with a vague sense of the cause of the problem that basically boils down to finger-pointing and saying, “It was their fault,” the real answer finally emerges: “I need to engineer my technology service to gracefully handle any condition that it might be required to address. Now, how do we build that?” By diving deep into the real conditions and managing the dependencies of others, true answers to problems are found.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“At Amazon, Two-Pizza Teams work like little entrepreneurial hothouses. Insulated from the greater organization’s bureaucracy, the Two-Pizza Teams encourage ambitious young leaders, provide opportunity, and instill a sense of ownership.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Amazon, Two-Pizza Teams work like little entrepreneurial hothouses. Insulated from the greater organization’s bureaucracy, the Two-Pizza Teams encourage ambitious young leaders, provide opportunity, and instill a sense of ownership.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Find the value in each person. We all have weaknesses, but we also have strengths. Everyone brings something different to the table. Find what is unique in each individual and use that unique strength for the good of the team.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“One reason that I really enjoyed my time there was the ability to work collaboratively without worrying about titles, organization charts, and official roles. All of those things got ditched at the door so we could devote our energies to attacking problems.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Flourishing companies are filled with incredibly bright people who have the authority to achieve but also the confidence that, if they fail, someone will be there to pick them up off the floor, dust them off, and give them another shot.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“But equally important is trust within the business, which means that leaders at Amazon must learn both to trust their colleagues and to earn their trust through transparency, commitment, and mutual respect.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Leaders listen attentively, speak candidly, and treat others respectfully. They are vocally self-critical, even when doing so is awkward or embarrassing. Leaders do not believe their or their team’s body odor smells of perfume. They benchmark themselves and their teams against the best.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“If you can project yourself out to age 80 and sort of think, What will I think at that time? It gets you away from some of the daily pieces of confusion.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“I wanted to project myself forward to age 80 and say, “Okay, now I’m looking back on my life. I want to have minimized the number of regrets I have.” I knew that when I was 80, I was not going to regret having tried this.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Jeff explains it this way: “Take a long-term view, and the interests of customers and shareholders align.”67 That’s the philosophy that has made Amazon so successful. Another way of saying it is if you’re inefficient and have fat margins, you die a Darwinian death.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“In the model Amazon uses, capital expenditures are subtracted from gross cash flow. This means that the cash is available to grow the business by adding new categories, creating new businesses, scaling through technology (done often and well at Amazon), or paying down debt (in 2004, Amazon had $4 billion in debt, and some FCF was used to pare that down). Of course, that extra cash could also be given back to stockholders in the form of dividends (never really considered) or given back to shareholders”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Do you want to be a $200 million company with a 20 percent margin or a $10 billion company with a 5 percent margin? I know which one I want to be!”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Free cash flow is the key phrase in that comment. Jeff returned to the subject in a January 3, 2013, Harvard Business Review interview: “Percentage margins are not one of the things we are seeking to optimize. It’s the absolute dollar free cash flow per share that you want to maximize. If you can do that by lowering margins, we would do that. Free cash flow, that’s something investors can spend.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“I explained how key judgments were made during my years at the company: “It was not the title but rather who’s got the best idea. Who’s bringing the solution to the table? That’s what was most important.”48 To be blunt, as an Amazon leader, you don’t get the chance to make a lot of mistakes. Screw up for long enough, or for the wrong reasons, and the island will simply vote you off. It is the strongest culture of performance I have ever experienced, and it is directly tied to metrics, results, and being right, a lot.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“When you have to be super specific, it further drives a culture of clarity, commitment, and accountability.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“As Dwight D. Eisenhower said, “Plans are nothing; planning is everything.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“The resulting culture of learning, growth, and accountability would be impossible without a high premium on clarity—clarity in the setting of goals, the communication of those goals throughout the organization, the establishment of metrics, and the use of those metrics in gauging the success or failure of any initiative.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Leaders are right a lot. They have strong judgment and good instincts. They seek diverse perspectives and work to disconfirm their beliefs.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“I often ask an audience to raise their hands if they believe that sustained and systematic innovation is critical for their business success. Over 90 percent of the audience will raise their hands. I immediately follow up with the question, “Who here has a process or system for ensuring sustained and systematic innovation?” Typically less than 10 percent of the audience raises their hand. Stunned. We realize that innovation is key, but we are unwilling to make it a priority for budget, a priority for our time, a priority for applying senior leadership, a priority for breaking from tradition and calcification and making change happen, or a priority for being willing to be misunderstood. If you’re going to innovate, you often need to endure others (competitors, the financial market, press, etc.) laughing or being sarcastic or negative.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“The biggest needle movers will be things that customers don’t know to ask for. We must invent on their behalf. We have to tap into our own inner imagination about what’s possible. AWS itself–as a whole–is an example. No one asked for AWS. No one. Turns out the world was in fact ready and hungry for an offering like AWS but didn’t know it.”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles

“Fulfillment by Amazon (FBA),”
― John Rossman, The Amazon Way:: Amazon's 14 Leadership Principles