Business Week has an awesome cover story on Amazon.com this week and its founder, Jeff Bezos. Here’s a story that lets you know what kind of company he is running:
Within Amazon.com (AMZN) there’s a certain type of e-mail that elicits waves of panic. It usually originates with an annoyed customer who complains to the company’s founder and chief executive officer. Jeff Bezos has a public e-mail address, jeff@amazon.com. Not only does he read many customer complaints, he forwards them to the relevant Amazon employees, with a one-character addition: a question mark.
When Amazon employees get a Bezos question mark e-mail, they react as though they’ve discovered a ticking bomb. They’ve typically got a few hours to solve whatever issue the CEO has flagged and prepare a thorough explanation for how it occurred, a response that will be reviewed by a succession of managers before the answer is presented to Bezos himself. Such escalations, as these e-mails are known, are Bezos’s way of ensuring that the customer’s voice is constantly heard inside the company.
I love the fact that the CEO of one of the largest companies in the world is taking care of customer complaints.
That sole focus on the customer is one of the reasons Amazon.com is one of the best run companies out there. Bezos had this to say on how they come up with new ideas:
We innovate by starting with the customer and working backwards. That becomes the touchstone for how we invent.
The customer experience has led to stock returns in the past 5 years of 40%+ per year versus about 16% a year for the S&P 500.
It’s amazing that more companies don’t share Amazon’s drive for building long-term value over beating short-term quarterly earnings estimates. That long-term thinking is one of the reasons they are one of the few internet-based companies that survived and thrived post technology bubble in the late 1990s.
Anyone interested in entrepreneurial endeavors or investors that would like to learn about a quality company should read the entire piece from Business Week.
A Wealth of Common Sense is a blog that focuses on wealth management, investments, financial markets and investor psychology. I manage portfolios for institutions and individuals at Ritholtz Wealth Management LLC. More about me here. For disclosure information please see here.
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