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Amazon is undoubtedly one of the titans of the tech industry, pioneering new capabilities and developing services that companies across industries rely on. But many business leaders look to Amazon for more than AWS and other tech services. The business practices that have made Amazon a giant company with a global reach have been the subjects of multiple books and articles and serve as an inspiration for company leaders everywhere.
Tech leaders are no exception when it comes to admiring Amazon, not only for how its day-to-day operations are run but also for the way it pursues technology R&D. Below, 11 members of Forbes Technology Council share the lessons they’ve learned from observing Amazon over the years.
1. Turning Internal Infrastructure Into A Business Segment
Amazon’s ability to turn internal infrastructure like AWS into a flagship business offering is a trend many tech companies can replicate. The roots of AWS go back many years to when Amazon’s team started building robust internal systems to meet the hyper-fast growth they were experiencing. That was the foundation of AWS, which has grown into one of the most successful cloud infrastructure offerings in the market. - Adi Ekshtain, Amaryllis Payment Solutions
2. Understanding The Importance Of Pricing
AWS has shown us the importance of pricing and how nuanced that world can be. It’s amazing to watch such a robust ecosystem of tools emerge to help clients manage and reduce cost, a trend that I expect to continue and expand to other sectors. - Dave Hecker, iTechArt Group
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3. Adopting Smart Customer Experience Practices
Amazon’s reach across the world, personalization, customer-centric approach and more teach a lot to industries ranging from financial services to energy and utilities. We’re working to make robust, integrated enterprise CX platforms more accessible to billions of people and provide them with end-to-end capabilities to save energy and water. Amazon’s experience nudges us in the right direction. - Deepak Garg, Smart Energy Water
4. Recognizing When A Market Has Matured
As a general rule of thumb, when there is an Amazon version of a product (for example, the Amazon Basics line), that market or innovation is now mature and is becoming commoditized. Players will then need to compete on quality, benefits and service rather than price. - Alexander Hill, Senseye
5. Leaning Into Adjacent Processes
Once Amazon conquered online ordering, they moved into logistics, and following that, they moved further into the supply chain by creating their products and shipping divisions. Other companies should learn to lean into adjacent areas that will create efficiencies in their processes and then integrate the technologies to provide even more seamless experiences for customers. - Luke Wallace, Bottle Rocket
6. Holding No Process Sacred
The key to Amazon’s success is that nothing is sacred. No business process is perfect and without room for improvement. No new technology is too crazy for Amazon to try: drones to fly packages, rockets in space—they’ll try anything. And they will cull through failures and successes at stunning rates. Amazon has the same access to technology everyone else has. It is fearlessness that separates them. - Kevin Parikh, Avasant
7. Developing Solutions From The Inside Out
A lesson to learn from Amazon is to develop for yourself and then for others. The whole reason for Amazon’s success is the development of systems, software and so on that are modular and not only solve its internal problems, but others’ as well. When you think and develop like that, you will be earning money on the inside by saving money, and you’ll also be earning revenue on the outside by solving the same problem for others. - WaiJe Coler, InfoTracer
8. Decentralizing Teams And Architecture
Amazon is famous for “two-pizza teams.” This is the foundation for decentralized teams and architecture. These self-organized teams are responsible for planning, building, running and retiring a product and are empowered, engaged, entrusted and equipped with agility. The success of this concept has inspired even non-technical teams to use it as an operational model. - Asanka Abeysinghe, WSO2, Inc.
9. Eating Your Own Dog Food
Amazon builds great platforms, and the now-famous “API mandate” highlights that fact. They eat their own dog food, and their teams communicate with each other through the same APIs that are exposed to external developers. This helps issues get discovered and debugged faster, before external customers find them, and smooths escalation workflows. This has helped make AWS a successful developer platform. - Vishwas Manral, McAfee
10. Moving Quickly From Idea To MVP
One thing I like about Amazon is that they move quickly from ideation to minimum viable product, putting the product into the hands of customers and getting their feedback before making large investments. Another Amazon practice I admire is that they monetize the surplus in what they use, including their marketplace, AWS, physical storage, shipping and almost every aspect of their business. - Selva Pandian, DemandBlue
11. Monetizing Back-Office Systems
How do you monetize your back office? Amazon needed huge server farms to run its stores. For many years, it was an expense. Now it is a profit center: AWS. If your company does something really well on the backend, there is another company willing to pay you to do the same thing for them. - David Moise, Decide Consulting
