He’s a pro-customer, tightfisted risk-taker who is conditioning Wall Street to embrace his erratic earnings. If you’re running a business with high margins — watch out.
FORTUNE — Jeff Bezos likes to read. That’s a dog-bites-man revelation if ever there was one, considering that Bezos is the cerebral founder and chief executive of a $100 billion empire built on books. More revealing is that the Amazon CEO’s fondness for the written word drives one of his primary, and peculiar, tools for managing his company: Meetings of his “S-team” of senior executives begin with participants quietly absorbing the written word. Specifically, before any discussion begins, members of the team — including Bezos — consume six-page printed memos in total silence for as long as 30 minutes. (Yes, the e-ink purveyor prefers paper. Ironic, no?) They scribble notes in the margins while the authors of the memos wait for Bezos and his minions to finish reading.
Amazon executives call these documents “narratives,” and even Bezos realizes that for the uninitiated — and fans of the PowerPoint presentation — the process is a bit odd. “For new employees, it’s a strange initial experience,” he tells Fortune. “They’re just not accustomed to sitting silently in a room and doing study hall with a bunch of executives.” Bezos says the act of communal reading guarantees the group’s undivided attention. Writing a memo is an even more important skill to master. “Full sentences are harder to write,” he says. “They have verbs. The paragraphs have topic sentences. There is no way to write a six-page, narratively structured memo and not have clear thinking.”
Jeff Bezos has always done things his own way, whether he’s ignoring Wall Street’s pleas for consistent earnings growth or requiring his top people to construct artfully written missives or launching seemingly disparate businesses — all at razor-thin margins. Only there’s nothing random about Bezos’s strategy. Indeed, like the memos he makes his managers write, his moves are driven by clear thinking and a cohesive vision, even if it takes a while for rivals to figure out Amazon’s motives — at which point it may be too late. Read the rest of this entry »