Amazon CEO Jeff Bezos returns to daily oversight of the company
Amazon CEO Jeff Bezos is now more fully involved in the daily operations of the company, after having spent the past few years almost exclusively focused on long-term projects.
Bezos has said he prefers working 2 to 3 years into the future, and he rarely gets pulled into the daily oversight of the company — unless something goes wrong.
The plethora of disruptions caused by COVID-19, including supply chain lockdowns and shipment delays, pushed Bezos to become more involved in the here-and-now issues facing the company.
While most of the issues are COVID-related, Bezos has spent his time addressing other challenges as well, including counterfeits, workplace diversity, and emerging competitive threats, like Shopify.
More recently, Bezos has slowly started to spend more time on his personal projects, after Amazon made hundreds of safety improvements and logistics updates to improve its supply chain and overall logistics network.
When Amazon’s finance team held its quarterly meeting with CEO Jeff Bezos this past April, they anticipated their boss would zero in on the estimated $4 billion in COVID-related costs.
That figure, which included costs for new safety measures and productivity losses, represented a huge undertaking that would wipe out the entire profit Amazon had expected to make in the second quarter. Given Wall Street’s growing focus on Amazon’s profitability at the time, the team had prepared for a long list of potential questions.
But Bezos didn’t dwell on the $4 billion. Instead, he spent most of the time drilling into other key parts of the business, like the sales growth and cost structure of individual segments, according to people familiar with the matter. In daily follow-up emails, Bezos asked deep questions about the roughly 45 revenue-generating units he closely follows at Amazon, and issues around the supply chain and customer satisfaction ratings.
“Jeff was more concerned about our operations,” said one of the people, who asked not to be identified because the discussions were private. “He’s very focused on the company now — he knows the numbers inside out.”
Amazon’s sales skyrocketed during the pandemic.
‘Wholly focused’
For many Amazon executives, Bezos’s increased engagement is a welcome return. They say his feedback during meetings is invaluable. His mere presence itself can elevate the quality of meetings as the participants become “more diligent” in their preparations, one person said. It’s a particularly important dynamic for newer executives who want to get up to speed, after a major shakeup took place in Bezos’s senior leadership team this year.
“He thinks like no one else does,” one of the people said.
For the rank-and-file employees, Bezos made his first appearance of the year during an all-hands meeting in October. At the event, Bezos spent time highlighting the company’s AWS cloud business, saying companies like Zoom have been able to get easy access to more computing power during the pandemic because of the work AWS has started putting in more than 15 years ago.
He also became visibly annoyed when he was asked about Amazon’s India business, which an employee called “second to Flipkart.”
“I don’t agree with the premise of the question there,” Bezos said, before letting Amit Agarwal, SVP of Amazon India, share more data about the business.
If not for COVID, however, Bezos wouldn’t have become so hands-on. As the CEO has previously said, the company requires his input on the here-and-now problems only when things go seriously wrong.
That quickly became the case after the pandemic hit in March. Amazon’s core retail business faced unprecedented challenges across the board, including a huge demand spike that caused major supply chain disruptions and long shipment delays. Unrest among warehouse and delivery workers erupted as Amazon didn’t move fast enough to improve safety protocols and address the growing number of coronavirus cases among its workforce.
Bezos responded by running daily calls with his top lieutenants and speaking with a number of government officials on how to help. By mid-March, Amazon required all office employees to work from home. Within weeks, it implemented a series of updates to improve workplace safety and provided temporary pay raises to warehouse employees. Major adjustments across its warehouse and website helped restore some of the shipment problems, though the workplace crisis persisted, including a series of walkouts and protests.
“My own time and thinking is now wholly focused on COVID-19 and on how Amazon can best play its role.”
One of the biggest passion projects for Bezos this year has been building an in-house COVID-testing lab, people said. Internally codenamed Project Ultraviolet, the initiative is designed to provide free testing to all Amazon employees.
Bezos has been deeply involved in launching the project, which is led by one of his most trusted executives, Cem Sibay. Amazon said it’s running 50,000 tests a day across 650 sites as of November, and expects to spend $1 billion on the initiative this year. Bezos even broke with the company’s long-held tradition of not discussing future projects publicly before launch, when he announced plans for the lab in April — a highly unusual move that reflects his enthusiasm for the project, people familiar with the matter said.
The episode illustrates the galvanized leadership this year by Bezos, who’s maintained a much more engaged operational presence in the face of the pandemic. After having spent the past few years almost exclusively focused on long-term initiatives, like his space company Blue Origin and other secretive hardware projects at Amazon, Bezos is now fully back in the trenches, driving discussions on the most pressing issues currently facing the company, six people familiar with the matter.
Bezos’s daily oversight primarily centers around the company’s response to COVID-19, but also includes addressing other immediate challenges, such as counterfeits, workplace diversity, and emerging competitive threats, like Shopify, those people said, who requested anonymity because they weren’t authorized to discuss Amazon’s business publicly.
It’s a dramatic shift for Bezos, who had taken a more hands-off approach in recent years. The 56-year old founder of Amazon has often said that he preferred working two to three years into the future, and rarely got pulled into daily operational work because he’s able to delegate most decisions.
The change first started to take shape earlier this year when COVID-19 upended Amazon’s core operations, as the New York Times previously reported. Ten months into the transition, however, all signs point to Bezos continuing to keep a strong grip on the day-to-day action, at least until the pandemic becomes more stable and normal, these people said.
Amazon is building its own COVID-19 testing lab.
Shopify, counterfeits, and BLM
Bezos has been spending time on non-COVID issues as well.
In recent months, Bezos has been directly involved in discussions about launching a new online store service that could potentially compete with Shopify, according to people familiar with the matter. Shopify sells the software tools needed to build an e-commerce site, and has become a popular alternative to Amazon for small business sellers looking to sell online.
The talks at Amazon were more of a “defensive” move to Shopify’s growing threat as a competitor, one of the people said, as there’s been a scramble among Amazon executives to respond to Shopify’s meteoric rise.
Bezos and his executive suite considered launching the service under the Amazon Web Services cloud unit, and having Yunyan Wang, the current technical advisor to retail CEO Jeff Wilke, run the business, one of the people said. Some executives pushed back at the idea, since Amazon had previously shut down a service called Webstore in 2015 that effectively competed (and failed) against Shopify.
It’s unclear how far Amazon has moved with the idea, as there’s a sense of having already conceded the market to Shopify among Amazon executives, one person said. Bezos, meanwhile, showed his heightened awareness of Shopify, publicly mentioning the company as a competitor for the first time in his July letter to the House Antitrust Committee.
Bezos also has been sharing some very specific ideas around Amazon’s anti-counterfeit efforts lately, two people familiar with the matter said. The issue has become a major headache for Amazon in recent years, causing some high-profile brands, like Nike, Birkenstock, and LVMH, to stop selling on its marketplace.
Bezos’s input was consequential in coming up with the idea for the new “Counterfeit Crimes Unit,” a new service that employs former federal prosecutors and investigators to track down and prosecute counterfeit sellers on Amazon. The service currently only monitors products sold on Amazon’s marketplace, but Bezos has backed the idea of potentially expanding it to crack down on counterfeits sold on other websites as well, these people said. Bezos’s message has been that there’s a huge counterfeit problem in the world, and Amazon should take charge and encourage others to work on solving the problem together. The team has used superhero analogies to describe the project, such as the “Avengers,” one of the people said.
As the Black Lives Matter movement spread across the country in June, Bezos also became more vocal about workplace inclusion, reigniting internal debates around improving Amazon’s own diversity problems, people said. The company later decided to double the number of Black leaders in each of the next two years, and ban the use of “non-inclusive” language in engineering documents.
“While our diversity, equity, and inclusion work is not new, we’ve definitely put in renewed energy behind these initiatives as a way to meet the moment,” Elizabeth Nieto, Amazon’s head of global diversity, equity, and inclusion, told employees in October.
Pendulum swinging back
Bezos’s return to the helm, however, hasn’t been all rosy.
Critics still question whether Amazon’s response to address the coronavirus pandemic and worker safety issues were adequate, while some warehouse workers continue to organize protests over the company’s business practices. Bezos and his leadership team came under fire in April for their leaked plan to “smear” a fired Black warehouse worker and paint him as “not smart or articulate,” as Vice first reported. A separate report by Vice also revealed Amazon’s extensive monitoring efforts over anti-unionization. Third-party sellers have raised concerns over Amazon’s marketplace issues, like price gouging, unfair suspensions, and inconsistent warehouse policies.
On top of that, the looming threat of breaking up Amazon over antitrust concerns continue to persist in the US and other countries.
Amid all this, Bezos has slowly been taking steps to work on other personal projects, according to one person. While the daily calls about COVID-responses are still there, Bezos joins them less frequently, freeing him up to work on other endeavors.
Bezos started sharing the progress of some of those projects through his Instagram account lately. In September, he announced the opening of the first Bezos Academy, and in October, he posted about Blue Origin for the first time this year. He also shared new updates on his personal charity work, such as the Bezos Earth Fund and Bezos Day 1 Families Fund, in the past few weeks.
“The pendulum swung very hard in one direction earlier this year, and it’s starting to come back the other way,” one person said.
Meanwhile, the frequency and size of Bezos’s annual stock sales — which he uses to fund his personal projects — has increased significantly, surpassing $10 billion for the first time this year.
The COVID-19 crisis has been a boon to both Amazon and Bezos. The pandemic-fueled shift to online shopping has made Amazon one of the biggest beneficiaries of COVID-19, pushing its stock price up nearly 70% this year. As a result, Bezos’s personal wealth, mostly tied to Amazon stock, has grown to over $180 billion — keeping him firmly in place as the wealthiest person in the world.
But even the world’s richest man couldn’t do anything about the stay-at-home mandate, which appears to have given him some extra time to indulge in TV like everyone else.
“I’m always a binge-watching ‘The Boys’ — I’m fully caught up there,” Bezos said during October’s all-hands meeting. “Of course, I’ve binge-watched ‘Tiger King’ at the beginning of the lockdown, and if I had a recommendation, if you haven’t watched ‘The Expanse,’ I’m eagerly awaiting the new season, which is coming out soon.”
Jeff Bezos is back in the trenches at Amazon. Insiders describe working with a more deeply-involved CEO. https://t.co/zqAjUycfmn
— Business Insider (@businessinsider) December 13, 2020
