Grab an armful of business leadership books from your nearest bookshop and look through them for advice on how to treat staff. I doubt you’ll find any of them encouraging business leaders to humiliate their colleagues in public more frequently.
Yet one of the most memorable stories in Brad Stone’s account of how Jeff Bezos made such a success of Amazon is just such an encounter with a senior manager. They were giving answers that Bezos did not believe about the speed with which the phones were being answered by the customer service team. So in the middle of a meeting with senior managers, Bezos put a phone on loudspeaker, dialed Amazon’s customer service number and started ostentatiously timing how long it took to be answered. He’d been told that calls were being answered in less than a minute, but the meeting had to sit in excruciating silence as the minutes ticked up before finally the phone was answered.
A devastatingly effective way of making a point, true. But how do you combine such a brutish attitude at times with an ability to recruit, retain and motivate the sort of brilliant staff you need, especially when Amazon wasn’t paying high wages? The mystery is deepened by the grimly humorous collection of stories of other technology CEOs and their abrasive behaviour that Brad Stone presents in the book.
As with Steve Jobs, reading about Jeff Bezos and all his quirks in dealing with other human beings (not to mention Amazon’s huge sums spent on failed takeovers) leaves you wondering for much of the time if you’re reading an account of a brilliant success or a tragic failure. Clearly the path Amazon has taken shows he – like Jobs – is the former.
But whilst Walter Isaacson’s biography of Jobs does answer the question of how Jobs and Apple ended up so successful despite his manner, in the case of Bezos and Amazon, Brad Stone leaves that question only partly answered. Early on in the book Amazon is but one amongst many online book selling startups. Stone explains well why traditional bookselling firms found it difficult to move into the online business, constrained as they were by their heavy investment in offline stores. Why, though, did Amazon triumph from all those different online startups? That Stone doesn’t tell us.
The more successful Amazon gets, the better Stone’s book does explain its gathering momentum, especially thanks to Bezos’s insistence on using Amazon’s scale to drive prices as low as possible. There are two types of company, Bezos says. Those that looks to charge as high a price as possible (think Apple) and those that look to charge as low a price as possible (think Amazon). Amazon’s low prices may have kept its profits down, but they have hugely boosted its size and, while Apple’s high margins have attracted big competitors eating into its market, Amazon’s low margins have kept competitors out of the market, leaving more space for it to grow even further.
It’s a shame though that the initial crucial breakthrough remains unexplained even by the end of an enjoyable book.
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