The Amazon Effect: Embrace Ownership Mentality
Each year, Jeff Bezos, the mastermind and business innovator behind Amazon shares a letter with his shareholders. These letters, dating back to 1997, serve as a goldmine of independent and innovative thinking for today’s business leaders. Our series, The Amazon Effect, focuses around these letters – and today we’re discussing ownership mentality.
We discussed at length how you should make it a priority to stay customer focused as a business and not get distracted by stockholders and other voices that you’ll compile as you reach greater success.
In his letter from 2003, Bezos wrote about how long-term thinking for any organization is rooted in ownership and ownership thinking. Let’s take a step back and peel back the layers of this advice.
We’ll borrow a from Bezos himself to give you an example. Say you own a house and you’re renting it to a family. Chances are, the renting family will think in a more short-sighted mindset when it comes to the maintenance of the home. They might paint the walls an ugly color, or, to borrow Bezos’ example, might nail their Christmas tree to the floor instead of buying a stand. Why should they care?
They’ll only be there for a short time, and they’ll move onto to live somewhere else. The house only has value to them immediately.
But to you, the house is your asset. You’ve spent money on it, and you’ll have it long after those tenants are gone. Furthermore, the actions those tenants take will have far more of an impact on you than they will on the tenants. You’re the one that has to worry about fixing the floor.
The solution, as suggested by Bezos, is to keep an eye on the core purpose of your business and your customers.
For larger businesses, shareholders tend to look for results quickly. They’re just tenants. They’re interested in the immediate future of the business and lining their pockets right now.
Their line of thinking might yield results now; but could be a big issue for your business down the road.
But what do they care? To extend the Christmas tree analogy, they just want to celebrate Christmas. They’re not worried about the damage to the floor years down the line.
For smaller businesses, this logic extends to employees and colleagues. The people you employ might tend to be short-term thinkers. They’re motivated to work quickly, to earn their paycheck this pay period. What do they care if you’re out of business in five, ten or twenty years?
Short-term, earn money now thinking is toxic.
As a leader, you should work to constantly infuse long-term thinking in your business, in shareholders and with your team. You want everyone to think like owners in your business, with a vested stake in their own success and the future of the business. You want everyone to treat the house like they own it, not like they’re just renting.
It’s difficult to create that environment, but it starts with you, as a business leader maintaining focus on the customer experience.
In our series, “The Amazon Effect” we’ll delve further into Bezos’ yearly letters to shareholders and how they can help you and your small business. Keep checking back for more.