The 20th anniversary edition of the shareholder letter, and my favorite of the collection of letters; I specifically love it for the section on communicating via a written narrative. More on that below. We first hear about Amazon being #1 in customer satisfaction 8 years in a row, and he gives a big ‘thank you’ to the 560k employees at Amazon. Jeff then goes on to talk about a trait he loves in customers — discontentment. But how does Amazon handle that? By having high standards. (I know, I thought he was going to say Customer Obsession too!)
Are high standards intrinsic or teachable? Are they universal or domain specific? What should the scope be? How do you recognize them? What skill does it take? Jeff answers each of these questions with a story about handstands.
Then we get to my favorite section: six-page narratives. This will change the way you work and formulate ideas! I’ve included all three paragraphs of this section below. Think about this the next time you need to communicate an idea, propose a change, or reflect on something.
He wraps up the letter with three pages of milestones from all across the business.
“We don’t do PowerPoint (or any other slide-oriented) presentations at Amazon. Instead, we write narratively structured six-page memos. We silently read one at the beginning of each meeting in a kind of “study hall.” Not surprisingly, the quality of these memos varies widely. Some have the clarity of angels singing. They are brilliant and thoughtful and set up the meeting for high-quality discussion. Sometimes they come in at the other end of the spectrum.
In the handstand example, it’s pretty straightforward to recognize high standards. It wouldn’t be difficult to lay out in detail the requirements of a well-executed handstand, and then you’re either doing it or you’re not. The writing example is very different. The difference between a great memo and an average one is much squishier. It would be extremely hard to write down the detailed requirements that make up a great memo. Nevertheless, I find that much of the time, readers react to great memos very similarly. They know it when they see it. The standard is there, and it is real, even if it’s not easily describable.
Here’s what we’ve figured out. Often, when a memo isn’t great, it’s not the writer’s inability to recognize the high standard, but instead a wrong expectation on scope: they mistakenly believe a high-standards, six-page memo can be written in one or two days or even a few hours, when really it might take a week or more! They’re trying to perfect a handstand in just two weeks, and we’re not coaching them right. The great memos are written and re-written, shared with colleagues who are asked to improve the work, set aside for a couple of days, and then edited again with a fresh mind. They simply can’t be done in a day or two. The key point here is that you can improve results through the simple act of teaching scope – that a great memo probably should take a week or more.” — Jeff Bezos