Brad Stone on “The Jeff Bezos Paradox”

From a guest essay by Brad Stone in the New York Times headlined “The Jeff Bezos Paradox”:

The latest creation from the technology giant Amazon occupies two floors in a shopping district in central London: a hair studio. Inside the 1,500-square-foot Amazon Salon, customers can visualize potential new hairstyles on the company’s tablets, buy shampoos and conditioners not available in drugstores, and order up things like a children’s haircut ($20), a roots tint ($62) or a thermal cut with heated scissors ($166).

When the company announced this initiative in the spring, I probably wasn’t alone in thinking it might be an April Fool’s joke. Hair coloring and conditioning seem especially far afield from the company’s primary pursuits in e-commerce and cloud computing. And Jeff Bezos, the wealthiest person in the world, hasn’t had a substantive topiary mane himself since the early 1990s.

But something about the salon seemed apt considering Amazon’s wide-ranging ambitions under Mr. Bezos, who will retire as chief executive on Monday after running the company for 27 years. He founded Amazon in July 1994 to sell books online, a deceptively innocuous objective that served as a beachhead for one of the most successful expansions in business history. Today, the company is a kind of corporate apeirogon — a shape with infinite sides — extending into new industries on a regular basis, terrifying potential competitors and sending blasts of anxiety across the antitrust establishment.

Mr. Bezos now hands his successor and longtime deputy, Andy Jassy, a company with the third-largest market capitalization in the world. But there’s an incongruity — call it the Bezos paradox. As the fortunes of the company and its founder have increased, their public images have taken a beating. Amazon’s workers are often pushed to the limit by arduous goals, arbitrarily changing rules and algorithmic masters, which seem to have little tolerance for human frailty.

I’ve written two books chronicling Amazon’s history and have come to view both the company’s never-ending expansion and declining reputation as byproducts of Mr. Bezos’ personality — his towering intellect, along with a notable deficit of empathy and fear of stasis.

Early on, Mr. Bezos judged that in an age of disruptive technological change, companies would have to keep trying new things at a rapid clip, even at the risk of failure and embarrassment. “Doing things at high speed, that’s the best defense against the future,” he once told the journalist Walter Isaacson. “If you are leaning away from the future, the future is going to win every time.”

So he requested that teams across the company regularly come up with new projects. Mr. Bezos wanted Amazon’s famous six-page documents, the atomic unit of its internal deliberations, to include not just financial results and projections but also new product pitches and expansion plans….He fired emails off to deputies at all hours….

A few favored executives could also generate outlandishly ambitious initiatives, even if they were far from Mr. Bezos’ personal geeky interests. Dave Clark, the executive who oversaw the company’s supply chain for a decade, wanted to break Amazon’s dependency on UPS and FedEx, in part by assembling a fleet of airplanes called Amazon Air. Similarly, the executives who run the British retail team proposed opening hair salons to sell more professional beauty care products while showing off the company’s tablets and other devices.

Why not? Among other things, Amazon under Mr. Bezos has been a trial-by-error machine, writ large….The alternative, in the Bezosian lexicon, was to become a more conventional “Day 2” company. “Day 2 is stasis, followed by irrelevance, followed by excruciating, painful decline, followed by death….And that is why it is always Day 1.”…

Mr. Bezos’ peripatetic attentions have made the older divisions — and their customers — feel overlooked. Bookselling and publishing, once areas of obsessive focus, now seem like afterthoughts; Mr. Bezos’s interest is really in Prime Video and Alexa.

As a result, large portions of Amazon’s website now resemble an unpoliced frontier. Over the past few years, journalists have discovered counterfeits, fake reviews and unsafe products on the everything store. Domestic merchants increasingly complain that they feel displaced by overseas sellers with lower costs and knockoff products. When they seek redress, they struggle to get Amazon employees to take notice and devise solutions. Often, change comes only after problems surface in news reports.

Much of this is by design. Mr. Bezos started new initiatives with personalized care; but as they got bigger, he wanted to manage them with technologies that require less employee attention, thus lowering operating costs….The strategy has been great for investors, who have quadrupled their money in the past five years. It’s even been good for customers, who enjoy low prices and fast delivery — until they inadvertently buy a cheap knockoff on the Amazon website. For many of the employees, partners and small companies caught up in Amazon’s whirling ecosystems, not so much.

The current reproaching of Amazon in the popular press often traces back to Mr. Bezos. Colleagues new and old testify that he has many talents, including a superhuman ability to focus on disparate issues and get to the bottom of complex problems. But empathy was never one of them. “If you’re not good, Jeff will chew you up and spit you out,” a former executive once told me. “And if you’re good, he will jump on your back and ride you into the ground.”

This will be the defining challenge for Andy Jassy, the incoming chief executive: to sandpaper the rough edges of Amazon’s business tactics and formulate a humbler image for the company, particularly before the many antitrust authorities trying to unravel the opaque, interlocking parts of the Amazon empire….

Mr. Bezos will remain as executive chairman and head of the board. But signs point to his diminishing day-to-day involvement. He’s off to suborbital space on July 20 on a Blue Origin rocket, to his magnificent sailing yacht and luxury homes, and to his philanthropic endeavors, which include the $10 billion Bezos Earth Fund, devoted to the cause of stemming climate change. He is likely to apply the same roaming curiosity and intolerance for stasis to his life outside Amazon that he did for his career inside it.

As for his colleagues, now the really hard work begins: finding Amazon’s heart.

Brad Stone is the author of “Amazon Unbound: Jeff Bezos and the Invention of Global Empire” and a senior executive editor for global technology at Bloomberg News.

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