In recent years, Amazon revolutionized the market with the launch of the Echo smart speaker and Alexa voice assistant, which have become household names. People now “Ask Alexa” for information, similar to the way they would “Google it.”
Known for his influence on tech companies, Bezos’ management ethos shaped the industry. His “two pizza rule” dictated that meetings should be small, with enough attendees to be fed by just two boxes of pizza. His “day 1” philosophy emphasized relentless innovation and avoiding complacency.
However, there is evidence that Bezos’ focus started to wander. His significant personal investments in Blue Origin, his rocket company worth $1 billion per year, and his philanthropic endeavors diverted his attention. By the time of his departure, he was only spending a few days each week on Amazon.
Even Bezos’ nominated successor, Jassy, was surprised by his decision to step down in 2021. Jassy recounted, “I didn’t really think Jeff was ever going to do something different… I spent most of the first part of that conversation asking if he was sure he wanted to make a change.”
Wall Street technology analyst Dan Ives believes that Jassy faces a challenging situation after the Bezos era. According to Ives, “Amazon was bloated under Bezos and now needs more cuts… There is more pain ahead for Amazon.”
However, Mark Taylor, the head of trading at Mirabaud Group, feels that Jassy has been left with a difficult task that requires time. Taylor says, “Is Jassy under pressure? Yes, but he was left with a hospital pass from Bezos. It is a structural issue with retail so he will have time.”
Despite some investors’ frustration with share price declines, Jassy has long been one of Bezos’s most trusted lieutenants. He led AWS for two decades and played a crucial role in its launch alongside Bezos. AWS has been responsible for a significant portion of Amazon’s profits in recent years. Former Amazon executive Philip Green affirms, “Jassy still has Jeff’s ear.”
Green adds that AWS is well-positioned as other companies invest in artificial intelligence, as it provides the necessary computing power. Amazon is also gaining market share from traditional delivery companies like Royal Mail.
In November, Amazon became the first publicly traded company to lose $1 trillion in value. In a note to staff, Jassy reassured that Amazon has weathered uncertain and difficult economies in the past and will continue to do so. He called for staff to be “resourceful and scrappy” during the economic downturn. However, there are question marks about how much of a decline Bezos will tolerate before intervening.
Amazon cuts 18,000 jobs in its largest workforce reduction
By Matthew Field
Amazon is set to lay off 18,000 employees in the most significant round of cuts in its history, as it scales back investment in physical stores and its Alexa-powered smart speakers.
Andy Jassy, Amazon’s CEO, confirmed the extent of the layoffs on Thursday morning, citing the “uncertain economy” and over-hiring during the pandemic as reasons. The 18,000 job losses exceeded expectations, as company sources had anticipated around 10,000 job cuts.
The job cuts will affect Amazon’s “stores” business, including its online retail division and physical shops. Digital sales have slowed down since the easing of Covid restrictions, and the newly launched high street stores have struggled to compete with traditional brands.
The company will also reduce its internal technology teams and make redundancies in its hardware business, which includes the Echo smart speakers powered by Alexa and its books division.
Employees will be informed about their job security by January 18. The layoffs will impact teams in Europe.
While the number represents around 6% of Amazon’s corporate employees, it only accounts for around 1% of its total headcount, which includes casual and seasonal staff in warehouses and logistics.
Jassy, who took over as CEO from founder Jeff Bezos in July 2021, acknowledged that companies are no longer in a phase of significant workforce expansion this year due to the economic gloom. He emphasized the need for simplification to focus on what matters most to customers.
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