2008 – Working Backwards

Jeff opens the 2008 letter with a reference to the financial crisis plaguing the United States at that time. He reiterates Customer Obsession above all else, then talks about a common Amazon philosophy: Working Backwards. I’ve pulled the quote explaining why this process is important below. He then finishes out the letter talking to shareholders about Amazon’s ‘prudent spending,’ justifying the outlays of cash Amazon is spending in AWS, 3P (third party) tools, digital media, and the China market.

“‘Working backwards’ from customer needs can be contrasted with a ‘skills-forward’ approach where existing skills and competencies are used to drive business opportunities. The skills-forward approach says, ‘We are really good at X. What else can we do with X?’ That’s a useful and rewarding business approach. However, if used exclusively, the company employing it will never be driven to develop fresh skills. Eventually the existing skills will become outmoded. Working backwards from customer needs often demands that we acquire new competencies and exercise new muscles, never mind how uncomfortable and awkward-feeling those first steps might be.” — Jeff Bezos