Introduction
Leadership styles of executives define organizational culture and thus determine the health and profitability of business operations. Leadership is a process through which an individual guides, controls and influences the thinking pattern, feeling and behavior of fellow employees in an organization (Haiman, 1951). Organizations are positively influenced by leaders who have the ability to plan and act through their own unique styles towards achieving their long-term visions. Analyzing the styles of leaders of business organizations reveals why certain organizations keep on breaking sales records whereas others fail to create a significant impact in the consumer market. Broadly, today’s business organizations can be categorized into two groups: companies that charge more from the clients to compensate for their ineffectiveness and companies that continuously work hard to improve their effectiveness and make their offerings less expensive to their customers (Anders, 2012). Jeff Bezos, the founder and CEO of Amazon.com strongly believes in the latter, and his unique business philosophy coupled with remarkable leadership qualities has made him the most popular business leader today. Bezoz, who is currently leading the largest e-commerce business company on earth, is popularly known for his customer-centeredness and inspiring leadership acumen. Bezos is a team builder who continues to scale greater heights every year in the highly competitive global consumer market since he is an exemplary business leader guided by a passion to help his customers fulfill their cherished needs through exhibiting three basic leadership styles – innovative technocratic and high task-orientation.
Overview of Jeff Bezos’ leadership styles
Amazon.com, a current fortune 500 company with its headquarters in Seattle, was started in 1995 as an online store selling books in the garage of Bezos’ rental house. Bezos who cashed in on the popularity of the internet later diversified his online business by introducing a wide range of products like video games, CDs, software, toys, furniture and clothing. Amazon.com grew tremendously, thanks to the vision and customer-orientation of Bezos. Amazon’s annual sale skyrocketed from $ 150 million in 1997 to a whooping $ 23.81 billion in June 2015. Jeff Bezos attributes the success of his enterprise to “honest obsession to fulfill the needs of customers” (Kotler & Armstrong, 2014). Amazon believes in giving more value to customers through establishing relationships driven by a genuine interest in the customers. The basic question that drives this visionary leader is: what can Amazon do to make the life of millions of individuals living around the world? An organizational culture that believes in stepping into the shoes of the customers to understand their needs and give them excellent customer service through making most use of the technology is the key to the success of Bezos’ leadership. Bezos also practices a consultative leadership that constantly drives Amazon’s employees to think critically and challenge the ideas of each other towards innovating, which in turn promotes a friendly work environment that enhances their job satisfaction.
Bezos is a typical innovative leader who always experiments with technology to give better customer service. He also promotes a corporate culture of being always open with his investors about the experimentation tradition of the company. He writes humorously and frankly to the investors: “one area where we are particularly unique is failure” (McGregor, 2016). Bezos understands the truth that failure and innovation are inseparable. He repeatedly advises his team to experiment and explore new avenues. Bezos is also passionate about treading the unknown paths many leaders normally hesitate to take. For instance, the innovative Web-services of Amazon, cloud computing that was initially looked upon with skepticism is currently a $ 10 billion business for the company (McGregor, 2016).
Superior technical knowledge and an untiring passion to implement his technical skills to provide state-of-the-art customer service make Bezos a true technocrat. In fact, Bezos founded his business empire on two powerful foundation stones – his technical skills and ability to dream big. His technocratic leadership is always focused on achieving the long term goals. For instance, he often attributes his current achievement to the efforts put in by his team during the past few years. Similarly, he always adopts the strategy of starting with the customers and going backwards to integrate the latest technology to give best customer experience (Jeff Bezos’ leadership at Amazon 2016). His leadership inspired by task orientation stresses on imparting new skills to all team members in addition to adopting new technologies required for giving better customer service. His uncompromising work ethic and task-orientation is best explained by the screening procedure followed to recruit job candidates; Amazon is particular about recruiting candidates who have the ability to overcome ambiguities at the workplace.
Organizational structure of Amazon
Amazon’s corporate structure is moderately flat. Jeff Bezos, being the CEO, occupies the top level. Amazon board comprises of eight directors. Bezos oversees the Chief Technology Officer (CTO), the Chief Financial Officer (CFO) and the below-listed eight departments: e-Commerce platform, Business Development, Web services, North America retail, International retail, Digital media, Kindle, and Legal & secretary (EST 325: Amazon.com, 2016). The CFO of the company oversees the control and real estate departments. Similarly, the international retail department takes care of business in three regions: India, China and Europe whereas the North American retail department oversees these five divisions: Operations, seller services, toys, Amazon publishing in addition to music and videos, and home improvement and sports. The other major departments include sales and global advertising, customer fulfillment and computing services.
Amazon has 12 levels in its organizational hierarchy. Bezos himself occupies the 12th position. Senior vice presidents and officials heading the departments directly report to the CEO and occupy level 11(Stone, 2013). Vice presidents take up level 10 in the organizational structure. Level 9 is reserved for certain key new recruits as the directors occupy level 8. Level 7 employees of Amazon with a graduate degree are senior managers capable of overseeing level 6 and 5 employees. Amazon’s corporate culture insists that managers from level 8 need to spend a couple of weeks every year in customer care center to understand the day to day tasks of lower level employees. This helps the management to continuously keep in touch with the customers and their changing preferences. Also, level 6 employees are senior product managers who normally run a particular feature or product. Level 4 employees include fresh graduates who are newly hired. The remaining levels of employees are normally manual laborers who are employed in Amazon’s supply centers. These employees are ordinarily paid a daily wage.
Human capital management in Amazon
Effective supervision of employees by immediate superiors helps employees across all levels push towards achieving the common goals with a shared vision of the CEO. Amazon strictly follows the principle of promoting only the deserved employees who have proven track record, and who generally focus on the organizational goals rather than internal politics. Amazon’s workplace provides the right learning atmosphere to individuals who are passionate about developing technologies to provide effective customer service. Working with a technology department of Amazon would help an enthusiastic employee to understand all the intricacies of developing a new technology right from the inception of a new idea to launching a new service or product using the innovative idea (Soper, 2012). Bezos’ customer orientation always motivates the Amazonians to devise innovative means to serve their customers. For instance, the CEO’s passion towards innovative service led to the introduction of Amazon’s superior service, Prime Now. An executive of the Operations department of Amazon, Stephanie, shares her experience with a customer: her team could deliver an Elsa doll to a customer who could not get the doll anywhere in New York in just 23 minutes (Kantor & Streitfeld, 2015). Similar experiences of Amazonians reflect Bezos’ organizational culture known for each and every employee of the organization sharing his common vision. Incidents like the above testify Jeff Bezos’ philosophy of making life easier for his customers.
Jeff Bezos as a motivator
Bezos believes in talking less and achieving more. His strategies and actions talk more than his words. He believes in revealing information only to the concerned individuals. For instance, Amazon doesn’t even reveal how many employees are working in Seattle; also, Bezos himself carefully drafts letters to his stakeholders. His strategy of making his task force teams small stems from his belief that too much communication between team members leads to loss of productivity. Bezos never encourages communication across teams since it affects the independence of teams as it promotes individuals agreeing too much with each other (Drake, 2014). In fact, this contradicts the essential value that defines Amazon – creativity. Two essential ethical conducts of Bezos as a team builder are encouraging team members to try and fail, and disagreeing with the best option currently available towards improving the products and services.
Bezos’ leadership is often criticized as autocratic, and the workplace is found to be unfriendly by many youngsters. However, one can appreciate his leadership only on understanding his true inspiration – customer loyalty which is the key asset of Amazon. Bezos, as a visionary who believes in making sacrifices today so as to reap benefits in the long run is also a motivation to young leaders. The ground-breaking growth of the internet led Bezos to see opportunities in technological change which in turn motivated him to build his huge business empire. This is Bezos’ strong message to the youngsters who are tempted to see changes adversely. Thus, Bezos is a successful visionary leader who is an inspiration to the current and future generations. His powerful message to the business leaders is innovate, embrace change, and find new opportunities in change.
Best practices to be learned from Bezos
First and foremost, organizations can learn to recruit individuals who have a passion to innovate and give customers an exciting buying experience every time they deal with them. Attracting people with a DNA to pioneer and explore new ideas would build a workplace consisting of like-minded individuals who always care about customer experience. Secondly, Bezos gives a powerful message to fellow CEOs through his advice that failure is inevitable in the process of innovation. Most of the organizations keep away from investing on new ideas due to fear of failure. Bezos’ opinion about failure would motivate young minds to think critically and explore new avenues and product and service ideas. He also reminds CEOs that innovation is not quite expensive since it requires critical thinking to develop ideas rather than money to devise new products. Thirdly, most of Amazon’s innovative ideas like cloud computing and using drones to give product delivery were developed by teams comprising of a few members. Smaller the size of a team faster would be the progress towards achieving the team goals. This is a powerful reminder to expanding organizations that warrants representation of various departments while exploring new business ideas.
These three powerful lessons of Jeff Bezos would guide organizations to motivate their teams towards transforming the workplaces and giving excellent customer service.
References
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