How is Amazon leading the tech giants? How do they differ from Google or Microsoft?
The biggest difference is that Amazon is a customer-first company, while Google and Microsoft are technology-first companies. The biggest difference is that Amazon is a customer-first company, while Google and Microsoft are technology-first companies.
Amazon is a Customer-first Company
Amazon is customer-obsessed and its every decision starts and ends with the customer. In contrast, Google and Microsoft make decisions primarily based on the technology that their leadership and internal teams believe is important. Amazon will make a hypothesis, then quickly create a prototype to obtain live customer feedback about the hypothesis. When building the prototype, Amazon’s teams will often use non-scalable and “off-the-shelf” tech. The resulting customer feedback, in turn, will inform how (and if) to evolve the prototype and what more stable technology to use. As a result, Amazon makes decisions based on customer data or customer anecdotes (if data is not available.) This approach helps Amazon iterate quickly, and ship services that are pragmatic and start small. Amazon quickly adds features later, refines the required technology stack, and doubles down (if there is enough customer proof.)
“One-way door” vs. “Two-way door” Decisions
On the other hand, Amazon is unafraid to change its mind and kill a prototype quickly, if customer feedback shows that the initial hypothesis was bad. The cultural trait enabling Amazon to be this nimble is called “one-way door” vs. “two-way door” decision making. In other words, Amazon equates making a decision to walking through a door. 95%+ of all decisions are “two-way door” decisions, meaning that Amazon can walk through the door, see how it feels and walk back to the other side, if things aren’t working. A smaller number of decisions are “one-way door” ones, meaning that Amazon can’t walk them back easily. For example, a “one-way door” decision is where Amazon should open its HQ2 offices; a decision that is very hard to undo, once made. Therefore, when making decisions, Amazon primarily spends energy in determining if the decision is a “one-way door” type or a “two-way door” type. Once they establish that the decision is a “two-way door” one, Amazon will move incredibly quickly.
Microsoft and Google are Technology-first Companies
In contrast, Microsoft’s and Google’s decisions are determined by internal teams and leadership. These decisions are always logical and always make sense at the time, but frequently lack a predefined customer set. The teams add customer-use scenarios later, but often in a less-natural way (than technology) to the purpose of the product. This approach could lead to developing products that aren’t in tune with what customers want.
In time, both Microsoft and Google have certainly become better at shipping small and failing fast. But, in the end, technology is at the core of Microsoft’s and Google’s cultures. Customers are at the core of Amazon’s.
This originally appeared on amazonbound.today.
