Customer Experience The Amazon Way With John Rossman | Ep. 324
Amazon is, without doubt, one of the most popular online selling platforms and company in the world. Today, Jesse Cole talks with John Rossman, a former Amazon executive and the bestselling author of The Amazon Way and Think Like Amazon, about his definition of customer experience. John shows how they were able to captivate the true heart of their business – the customers – as well as how they measure customer experience. Get some expert branding and customer relations tips from John as he explains further about innovation in the marketing world and how to value customers in every angle of your business.
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Customer Experience The Amazon Way With John Rossman
Our guest is John Rossman, former Amazon executive and bestselling author of the Amazon Way and Think Like Amazon. John, I am excited to jam with you.
Jesse, thank you. I wish I had a great looking suit.
For the readers, they know I am always in this yellow tux because it’s always showtime. I’m fascinated by you, Amazon and your experience working with them. We have a lot of people that talk about Amazon, but not many people have been in Amazon, in the offices, in the trenches and you started your book with, “What would Jeff do?” You start your book talking about Jeff Bezos. I’d love some personal experience working with him. What a true visionary. I’d love for you to share that, you getting into the company and what that looked like.
First, thank you for having me, Jesse. It’s a real opportunity to get to talk, learn and trade stories. I was at Amazon from early 2002 through late 2005. It was for about four years. I’ve got to run two businesses. I launched the marketplace business and I ran enterprise services. That was a period of time when Amazon was dealing with a bunch of constraints. It was a fraction of the company now, but it was clear we were going to where we were going to make it. It’s like, “It’s going to fail or not.” It was clear we were going to succeed but we started to get clear about a couple of things.
First was that Amazon was two types of companies. First, we were a retailer and we were a technology company that liked to build tools that we and others would use. That’s the platform strategy notion of everything. The other thing that we started to get clear on was how do we make decisions? How do we work together? How do we hold each other accountable? How do we scale so everything doesn’t have to come to the center at that point? I still believe it’s true now. Jeff’s biggest concern was becoming bureaucratic, slowing down, not having as much fun, not having individual accountability, and slowing everything to the center.
Many of the things that we did were in setting up like, “How do we stay fast as a company?” A couple of the other things, I got to travel with Jeff to some of our enterprise clients and he would be asked often, “Jeff, how do you guys decide what to innovate on, invest in and things like that?” In one of his orientations that is a thoughtful one. He was like, “I always try to ask myself what are the durable customer needs. What are the things that won’t change over time?” He goes, “For Amazon, I can’t imagine a world where a customer wants higher prices. I can’t imagine a world where a customer wants less selection and I can’t imagine a world where a customer wants slower delivery.”
At that point, this was in 2004, and he goes, “Almost everything that we invest in is in those three durable customer needs, those three swim lanes. Even though one idea may not work, it’s going to build to other ideas, because we’re keeping them aligned according to these three durable customer needs.” That’s a thoughtful framework to think about for any company. What can’t you imagine changing relative to your customers and what their true needs are? How do you innovate to try to do small things to change, test, evaluate, pivot and go? If you keep doing them with a consistent set of strategies, you’re likely going to find success and you’re going to learn more along the way.
It’s fascinating and it’s making me think that in our world, I can’t imagine someone wanting less entertainment or wanting to not be entertained. Your definition of entertainment can be anything but now I want to be bored. I want to have nothing to do. It’s the same premise. I want to smile less, I want less happiness in my life, and I want less fun. The decisions to build are based on that. You talked about being with them a little bit. Are there any real experiences where you saw him doggedly focused on something or into something you could tell that this is Jeff?
I was at the receiving end of a few great conversations and everything. They were never personal. It was always true and this is about everybody. This isn’t about one individual. The one I’m thinking about is we were in a conversation I was running the marketplace business. My technical job was Director of Merchant Integration, but he wanted me to think much bigger than my job title. If something was constraining our business, he’s like, “John, you don’t need to ask for permission to go put pressure and problem solve in areas that may not technically be within your organization or your control.”
He gave me this great conversation. That takes good wisdom to understand what are the inherently hard things in the business versus what are the things that should be simple, but for some reason, we allow it to be hard and everything. That was a real learning moment as business leaders, regardless of whether they’re in your direct control or not. You have to recognize what should be simple and what am I allowing to become hard. We have to figure out a way to solve those things because we should only let hard things truly be hard.
As I’m working with my clients now and we’re working on, “We’ve got to move fast relative to a set of tests, experiments, hypotheses that we want to test for new businesses.” We’re letting things like procurement, HR policy, or tax become the hard things in our business. I’m always talking to my clients like, “If in a year from now, we get called to the board and the board goes, ‘Why didn’t this work well?’ We go, ‘It was because the procurement process slowed us down too much.’ We should be fired and everything because we’ve allowed things that should inherently be simple become the hard things in business. In whatever way we’ve got to do it, we’ve got to push through this and we cannot allow those to be the reasons why this fails.”
This is going to the 50 1/2 ideas from Amazon. I did 28, which is, think differently, asking different questions will result in seeing the customer the opportunity from a fresh lens in different constraints. That’s probably one of the questions. How do we make the hard simple? How do you look at the constraints? Can you give some more examples of that because that’s a starting path for innovation?
[bctt tweet=”From a customer’s perspective, everything should start with them.” username=””]Elon Musk is an interesting thinker along this line, which is that he always thinks about first principles. What he means by first principles is what are the theoretical limits of how something works and let’s start with that and as and that as the goal. When you think about delivery capabilities, instantaneous is the theoretical limit. That’s the first principle. It can’t go faster than immediate. Let’s talk about decreasing cycle times. Why is there a cycle time for procurement, implementation, and adoption? How do we radically close the cycle times? One of Amazon’s big businesses is AWS, Amazon Web Services, which is the Cloud Computing Division.
One of the brilliant advantages of that business versus the traditional business model of buying hardware, software, having it set up and all that is the procurement cycle time goes from months and weeks to get you to sign up for a website and putting in a corporate credit card. It’s that type of flexibility and asking a question of how would we make the cycle time instead of whatever it is now let’s say two weeks? How would we make it ten minutes? When you pose it as that type of question, you rethink all of the fundamental assumptions relative to the capability.
It’s ten minutes for the customer. Everything is the customer’s perspective. Everything starts with a customer and how you make it easier is the constraint.
The customer never wants a lead time. That’s never to their advantage. They may want control like, “I don’t want it immediately, but I want it on this specific date.” That’s different from having a mandated lead time relative to something.
In the starting point for innovation, you’re asking the right questions, but you’re this customer obsession that Amazon is focusing on relentlessly. Can you share some of the ideas from the book? The name of our company is Fans First Entertainment. It’s in the name of our company, but how did that happen in Amazon? How do you teach that to come up with these innovative ideas?
Amazon has fourteen leadership principles. The first is customer obsession and it reads, “Leaders start with the customer and work backward. They work vigorously to earn and keep customer trust and while they pay attention to competitors, they obsess about customers.” They use that word obsession purposely because it’s a pungent word. When you’re around somebody yourself who’s obsessed about something because they stand out. They come across as weird and disoriented. That’s exactly the point. Amazon uses that word obsession to be the reason or excuse for why they’re willing to struggle with hard things to own the customer experience. They give themselves latitude along with that customer experience. It’s not about your product or your service. It’s about the entire customer experience relative to your product or your experience.
Thinking back to retail, what most retailers would say is, “I own what the product is, the quality of the product and everything, but somebody else delivers it, disposes of it, or whatever it is provides training around it or something like that.” I don’t own that. In Amazon, our perspective was dramatically different. It’s like, “No, we own everything about the customer experience, whether we drive it or accountable for it directly or not. It is our customer and it is our brand. We have to innovate on behalf of them in the broader sense of that customer experience.” That’s what’s led Amazon into driving change in so many industries like logistics service. It’s because like, “It doesn’t matter that we are that we don’t drive the trucks. Our customers are counting on us to be precise, faster and be nimbler relative to logistics as part of the customer experience.” Amazon has dramatically been the force of changing logistics in the last mile delivery capability. That’s one example.
The other one that we can tee on is that I believe the future of great customer experiences are experiences that are integrated across multiple products and hence across multiple enterprises. If you think about a company like Uber or Lyft, years ago, I was in New York, and I was at a restaurant, I didn’t know the address, it was dark out, and I had to get to my hotel. I knew the name, but I didn’t know the address. I would have to figure out how to get ahold of a taxi. How do I tell him the address I’m at? How do I tell him the address of the hotel and I have to give him my credit card? The beauty of business like Uber or Lyft is, with my phone, all I have to do is say, “I need a lift to XY Hotel.”
All of that experience payments, location discovery, driver allocation, and all that stuff are done in an integrated manner for me. That is truly the future of great customer experiences. What that means for organizations is we all have to become good at the things that create cross-enterprise customer experiences. Some of those things are technical, so things like integration and API that allows for data and processes to go across enterprises in real-time capability. There’s also a business model, legal model and data sharing models that we have to become good at if we want to create customer experiences that go across multiple organizations.
It’s almost looking at the all-inclusive experience. You’re literally thinking of it from the beginning and how do you put it all into one simple step and make it easy. It’s been tough for us to think about even the whole day fans coming to the game but our ticket experience corner said, “We can still impact when they come to the game by sending a playlist of music to get them fired up as they’re driving and start integrating those pieces while they’re not even here, but you prime them for the experience.” How do you go that full length to get them into the mode?
You could keep broadening your definition of what the customer experience is. What’s the friction of a family or a couple of getting to go to a game? Maybe it’s driving home from the game. “I’ve enjoyed the game a lot. I probably shouldn’t be driving but how do I get home?” Take it one step further. “You get me home, but how do I get my car that’s at the ballpark back to my house and everything?” You could keep expanding what you mean by that customer experience, so you reduce the friction and you increase the attractiveness of, “I get to go to a game,” versus all my other options out there.
It is looking at every possible friction point. We’ve learned so much from reading your book and hearing all these topics, because the reality is inconvenience fees that people have that they pay. We eliminate all those. You don’t have any extra fees or taxes. We do free shipping as well. We don’t charge a prime. We eat it because that’s what people have been used to. That’s the expectation that Amazon has put on us. It’s so important to look at those friction points. You’re right, even right after they experienced you and even before they experience not because they came into your building. What a great point you talked about is using metrics to measure the customer experience and you talk about not looking at the metrics that matter to you. Use the metrics that measure the experience. Can you give some examples of how that was integrated into Amazon?
It’s a good example and it’s a nuanced example, but it proves the point. It was back in the early 2000s when not everybody had incredible Wi-Fi and broadband to their house and everything. Customers were transitioning. A lot of customers still had dial-up modems. Some customers had some early versions of cable internet to their house and everything. The website reacted differently depending upon the quality of the service, the internet service provider, the ISP that a customer had. The merchant’s program was putting a lot of new products out there, a lot of new customers and a lot of new experiences. We were asked, “How do we problem-solve for customers and their website experience?” At first, the engineering team was like, “We can only do so much. We can only provide the ISP, to the internet service provider. It’s up to them on what the in-home speed is and the quality is and everything.”
We had a leader at Amazon, Jason Kyle, who’s like, “No. We’re going to measure what we call, To The Glass Customers Experience.” We were measuring all the way to the computer screen of what that customer experience was and we worked with different ISPs to show them, “You’re having some problems. Could you improve this?” We flexed a little bit with some of the ISP to get them improved and we innovated a website technique where we would sense the quality of the ISP and we would deliver the web page in a different way if you were a low-quality ISP versus a high-quality ISP. We figured out some ways to tailor how the website was being delivered to customers based on the quality of the ISP that they were having. We didn’t have that capability before. It’s a nuanced experience, but it came from measuring the entire customer experience, not only the part that we were responsible for.
Everyone measures how much revenue they’re making, but are they measuring the waiting time? How long until they got a callback? How many rings did they answer? What are those things? How do you park at your place? How long to get inside your place? It’s those metrics.
One of the important aspects of measuring is you have to be careful of measuring the means. The mean is the averages. Your average may be good, but you still have a set of customers who are getting bad customer experiences. We always would both measure the means and the averages, but also put in place what we call the service level agreement, an SLA. The SLA had to be a high bar SLA. By high bar, what we mean is typically, 99.5% of customers would get at least what the SLA measurement was. That’s only a small fraction. We held ourselves accountable not to the average customer experience, but to the worst customer experience.
Only a fraction of customers were getting a bad customer experience. That’s a totally different way of using metrics to deliver a customer experience than if I’m measuring the average of what the customer experience is. You have to be thoughtful about how you measure things appropriately. You always have to be thinking about a balanced scorecard. The cost, quality, speed, throughput, plus at the end of the day, your financial metrics. Financial metrics are always looking backward. They’re tough to operationalize. You’ve got to think about your balance scorecard of operational metrics, including the real customer experience in a longitudinal or in a horizontal manner.
It came to me that we always talk about what’s the perfect customer experience, but what if we got together on what’s the worst possible experience someone could have when coming to our game and to the ballpark? Hopefully, no one’s having it, but if it’s something that could get close to that, fix it. You talk about innovation by reducing friction. Amazon attacks friction. We’re talking about everyday shipping the customer reviews that are authentic, the multiple offers for customers to buy. The question that Amazon’s asking is how do you make buying and the whole process easier?
That’s one type but not solely the type of question but yes, in a lot of small little ways of, what are the little points of friction? A good example is Amazon continues now, as they have done for a long time on innovating in customer returns, which is an odd thing to innovate on. Why do I want to make it easier for my customers to return a product? Back in the early days of eCommerce, returning products was painful, friction and cost you money. A lot of companies made it hard because they didn’t want returns. Amazon took a long-term view on this.
They realized if a customer trusts that it’s easier to return a product for any reason, guess what a customer is going to do over a long period of time? They’re going to buy more products. Amazon continues to innovate on customer returns. It’s sometimes big things or small little things. My favorite new feature over the holidays was I could return any Amazon purchase, including third-party products, to an Amazon bookstore or to a Whole Foods location. It made it that much easier. I didn’t even put it in a box or have the packing slip. All I need to do is show a QR code. The service person scans it, they take the item, and you’re done.
That’s the type of relentless obsession around customer-driven friction that gives them ideas of, “How do we go even bigger? How do we leapfrog even bigger?” That’s the operational excellence genes or techniques in a company of getting everyday things right and that has tremendous benefit in your cost, quality, speed effectiveness for now. Also, that’s the fitness you need to build in order to have the big ideas that create a gap in innovation and competitive capability. If you stress the details every day, it’s going to give you the fitness and the insights in order to make big jumps in the future.
I’m excited to get to the big innovations. You’ve got me thinking in a sense that we tried to create a product where our customers feel that they’re taking advantage of us. When we look at our all-inclusive food, people are like, “How do you do that for $18 and the ticket includes everything? You must be wearing it.” That’s a good thing. With Amazon, if you can literally return everything and make it easier, you feel like you can take advantage of Amazon if you wanted to.
Bezos has a quote that’s along that line and he goes, “I want somebody to feel irresponsible to not be a Prime member.” When you think about it for whatever it is, $109 a year or whatever, all this stuff you get as a Prime member, he’s got the same mentality you do, which is, “I wanted to be irresponsible for somebody to not be a Prime member.” That’s a completely different type of question that you’re asking yourself that leads you to different insights and different strategies. That’s exactly the point of why the types of questions we ask set the fabric and framework for how we think about what our innovation potential is.
[bctt tweet=”It’s not just about your product or your service, it’s about the entire customer experience relative to your product or your experience.” username=””]You talk about creating a dreamy business a little bit, that one that customers love. Can you define that? What we’re describing is a dreamy business.
Dreamy businesses have a few different aspects to them. First of all, a dreamy business has to be a business that has some appropriate sense of scale to it. It’s cool to innovate but if there’s no market there, that’s a limiting factor. Dreamy businesses have an incredible total addressable market, a TAM. The second thing a dreamy business has is it sucks now. It’s not good now. There’s a ton of opportunity and there are high margins in it. If you can to a big market that has a ton of customer friction and a ton of margin in it, that’s a business that’s ripe for innovation and disruption. It has all the aspects and ingredients you need. To me, retail is a tough business. To me. it’s not a dreamy category because while it’s big in size, in general, retailers have adjusted their game and it’s a low margin business typically. All that is friction fulfilled. It is bad customer experience. Lots of tradition, and traditional business models to it, big margins, and there’s an opportunity for innovators in it.
Let’s get inside Amazon a little bit. Let’s talk about some of the games and the awards that they create for innovation. Something we’ve stressed is we do Ideapalooza, where you get the whole thing team together, we brainstorm, we solve problems, and we celebrate. It’s a lot of fun, but we don’t have awards to celebrate inventions. That sounds like one of the biggest things celebrated in Amazon.
Amazon set a culture that doing the right thing is going to be recognized, but it’s more of peer recognition and gaining prestige than it is about a big cash reward. The two rewards that I remember where one was called the Just Do It Award. The Just Do It Award was for somebody who saw a problem and fixed the problem without asking for permission. It could be somebody in a Fulfillment Center that saw a safety issue and they addressed the safety issue or it could be somebody on the technology team that saw a problem and did it. The reward for that was an old Nike sneaker that had been dipped in bronze. That was the reward, the Just Do It Award. You’ve got brought up on stage in front of the employee with all hands, got recognized and everything.
The other reward was for being an inventor and contributing to a patent and being named on a patent. Amazon has a valuable patent portfolio but the complete employee reward is you get a little puzzle piece of plastic that says, “Thanks for being an Amazon inventor, Jeff Bezos.” It’s not even signed by Jeff. It’s plastic. On the internal phone tool where you go to find an employee, your name next to it has this little puzzle icon telling all of your peers, “I’m an inventor.” They’ve completely gamified being an inventor that is prestigious, but the prestige is peer prestige. It’s not a monetary prestige.
The lesson to take from it is if you want your organization to be more creative, have higher accountability and be more inventive, find a sincere and long term consistent way of recognizing that behavior. It has to be authentic and it truly has to be earned. You can’t give it away, “This person deserves one because they’ve been here a long time.” That doesn’t do it. That’s a different type of reward. If you do that consistently, that’s the type of support mechanism that helps create this culture of innovation, growth or creativity that you want.
The book is Think Like Amazon: 50 1/2 Ideas. There’s no one thing you can do to have this incredible systematic approach for growth and innovation. There are lots of little things that you need to do. The real wisdom is in a certain circumstance, which are the 2 or 3 things that we need to use right now. I get asked all the time, “John, where do I start?” While I resist the notion of that question, there is no one thing to do. The one thing I would always start with is, how do we measure things on a daily basis. Data is the truth. If we can start with better metrics and how we use those metrics to gain insights into taking action. I can never lose with that question. Nobody ever does their metrics to the extent that they can do it.
Even Amazon is always challenging their metrics. They’re always adding to their metric. We have this whole mentality that your metrics are never done. When I work with clients, they go, “Let’s spend a couple of weeks on our metrics and we’re done.” Let’s spend a couple of weeks on metrics and we started on our metrics and we continue but we’re always asking ourselves, how do we improve our metrics? Metrics are the things that allow us to hold each other more accountable. They help us fight through our biases, which are our filters for how we process information. It helps us be more accountable as a team and as individuals. Metrics are one of the key things that every organization always needs more.
I love it and it’s important. I want to get practical and personal here. We’re a baseball team and now we don’t see ourselves as a baseball team. We consider ourselves an entertainment business. What metrics would you, Jeff or Amazon would look at for our baseball team or for what we’re doing to try to innovate?
Adoption is always a key notion within a business. Adoption means not only a customer buying, but a customer getting value out of the product. Maybe two things I would think about is, how many fans are staying to the end of the game? That might be an interesting way because what you probably measure is to the gate attendant or maybe it’s not even to that. Maybe it’s ticket sales, which doesn’t even mean they come in the door. I would want to understand abandonment all the way through the customer experience. You’re delivering more value on essentially a fixed cost if you get customers to stay the entire game. That would be one thing. The other thing is both loyal fans that continue to come, as well as how do I get to the new fan. Those are different types of metrics of how do I create loyalty and get recurring revenue fan attendance versus how do I get adoption into a new set of fans? Those would be some of the metrics I might be thinking about in your business.
I’m blown away because I believe so many teams aren’t thinking about that first question and that was our last Ideapalooza. I said, “We’re fortunate we sell out every game and we have a waitlist, but there’s still a problem.” You’re talking about friction points. It’s still too long and we know right now that less than 7% of our revenue total comes after 9:00 PM and what that shows is that so many fans are leaving and they’re done. It’s fascinating. The problem we’re trying to fix is what to keep fans later. We’re going to try out Bananas After Dark. It’s the whole experience when the lights turn off at the end of the game, but then maybe that’s not the right answer. Maybe the right answer is that fans want a faster game.
The other thing that I’d be thinking about is thinking about myself. What I eat and drink changes. For me, it’s a little early, at 7:00 PM and everything. There’s probably a certain set of stuff that I’m attracted to up to 7:00 but after that, as a parent, there’s a different set of needs and everything. Does your product need to shift a little bit later in the game versus the early parts of the game? All of those are opportunities for you to think about.
It’s great and the thing with Amazon, how much was speed discussed? I’ve come into this that speed is everything and convenience. I know that’s not one of the three things that won’t change but people want things faster, easier and want to do it on their terms. Was that every conversation on how we make it faster for people?
It’s always at the quality and on a cost basis. You have these constraints. It can’t be speed at any price or speed in any quality. It has to be the speed with cost and with quality in place. Those constraints are what force the breakthrough innovation that you need to have. In relative terms, it’s easy to optimize on one type of metric. What is difficult to do is drive improvement in a metric while maintaining parody or improvement in other balancing metrics.
You look at Alexa now. Someone must have said, “Wouldn’t it be faster if we said, ‘Play this and do this,’ as opposed to actually type this or write this?” That was one of those innovations.
The origin story of Alexa is interesting. Amazon had a massive failure called the Amazon Fire Phone. Not everybody maybe remembers that, but Amazon designed and built their smartphone and it was a complete failure. It was dead on arrival type of failure. From that failure, core elements, both technology elements, but also team capability elements came out of the Fire Phone and that seeded the Echo Alexa capability. If they hadn’t failed at the Fire Phone, they wouldn’t have gotten to the Alexa. It was Jeff leaning into that type of trial failure and saying, “Great. That wasn’t it yet but here’s the next step.” Not many companies have the type of conviction to double down. That’s $600 million in inventory of Fire Phones.
He’s saying what’s going to be the next billion-dollar failure. He’s talking about billion-dollar failures He had to think big idea. It’s absolutely brilliant. I wanted to quickly talk about the counter-intuitive way of working fast but also coming up with ideas by doing the six-page narrative that you share and the future press release. I love that because of the thought behind it, but can you share a little bit about that and how it helped? Were you ever a part of one?
I wrote many narratives and got frustrated by them and everything. The basic essence of it is instead of using PowerPoint to explain concepts, proposals, projects, we would write them out. While that sounds a subtle change, it’s an absolute game-changer. When you have to write things out to a specific audience for a specific purpose, with full paragraphs and sentences, it flows and makes sense. A reader could take this document without talking to you, read it and understand what you’re proposing. The level of critical thinking that a person or a team has to put in place to prepare the memo makes them think about stuff and they’re going to figure things out that they would have never figured out before.
The second big benefit is the groups who have to read these have to have to pay more attention. It’s harder to read a good memo than it is to have somebody present something to you. You get double the benefits. The basic techniques are in the book. It’s Idea 43, A Narrative About Narratives. Idea 44, Future Press Release is about this technique of being writers and it’s upfront. Before you do anything, it’s a Go Slow to Go Fast move. We spend the time to force ourselves to articulate what we envision the future customer experience being. What are the hard things we need to solve? How are we going to organize this? How are we going to measure it? How do we do it in this incremental and agile manner as possible? It’s all those different facets that you could think through.
You’re going to have two big benefits. First is you’re going to be more clear about what we are saying yes to versus what we are saying no to. That’s a big problem in most big enterprises, which is they let a lot of things go along. Many things are under-resourced and under attention. All of them suffer versus having a couple of big winners. The second big benefit is that when you do decide to go forward with an implementation or test phase, we understand the project or the idea so much better than we have lower risk, we proceed faster on it, and everybody’s better prepared for it. That’s the notion of behind it. Amazon calls this, “Start with a customer and work backward.” All these narratives, all these future press releases are written starting with the point of view of the customer, but transitions to what we need to do, contemplate, decide on, figure out or innovate on in order to achieve this mission.
If we’re looking at a new division or a new opportunity, we see that participation is declining dramatically and looking at an opportunity with kids, maybe the game is not as fun, cool, or relevant. We would write our narrative on all the challenges and the problems from the kid and the parent’s perspective. Everything that they’re going through, why they’re not playing it and the next would be a future press release a year in advance on what this did to change the landscape of Little League, Youth Baseball, etc. Is that the right framework?
It is and maybe there are nine different versions of that. Having the discipline to do that for nine different potential ways that you could solve business models, that’s work. At the end of the day, you pick one. You’ve studied that and consider that so much more deeply. In general, that’s cheap investment versus you deciding to go forward with one and figure out that wasn’t quite the right one.
It’s a time investment and if you want to do it right, you’re going to put the time in it anyways. This is what’s fascinating and people should do it because we’re at a spot where we can’t sell any more tickets. Our business for the first point hasn’t grown and we need to figure out, how do we spread this?
That and baseball season is only part of the year. You might be thinking about it and you’re probably way ahead of me on this and everything is, if we define ourselves as an entertainment business, that’s a year-round need. Baseball is one aspect of that entertainment brand. How do you build off of that? How do you transcend that?
[bctt tweet=”One of the important aspects of measuring is you have to be careful of measuring the means.” username=””]Those are the questions that we’re asking. You talked about the next step, too, which I love and I don’t know if we could do it in here, but write the user manual. No one thinks like this and it’s brilliant. Tell me about, what the user manual looks like?
You’ve written the narrative and the future press release, and you write the user manual. In your type of business, it might be for a stadium operator or some other role there. In our business, it was oftentimes for software developers. How would you use this tool that we were building for you before you built or designed anything?
Is it how the customer uses it?
Exactly. Whoever your customer is and everything. By forcing yourself to write out, “Here’s how the user would use this,” all you’re doing is identifying, “This is the stuff I understand well and this is the stuff I don’t understand well at this point.” Those are the risks in your project. It’s a way of helping to identify what do we understand well versus What don’t we understand well. If you understand what you don’t understand, you can bring those things forward into a project. Don’t leave in towards the end and address your risks early and you’ll have fewer surprises in your projects.
Is it the goal with a user manual? What made Apple great is you don’t need a user manual. They focused on making it. It’s a write it down and looks at it on how do we simplify this that we don’t even need this tool?
That’s one of the benefits. It’s how do you make it simpler and simpler for the user. The user manual shouldn’t be this tough and everything, but the other big benefit is you understand stuff so much better before you proceed on it. Including how do we make it simpler for the customer, so the ultimate is there is no user manual.
If you have a dental office, you’re trying to improve the experience, and do something different, write the user manual on how to go to the dentist.
That could be it or if the hygienist is a key part of that experience and we’re going to improve the customer experience by reinventing how the hygienist does their job. Let’s write the user manual, the operating procedure manual for hygienists. If we write that out, you’re going to see, “This is all this screwed up, sub-optimized, not only customer-unfriendly but hygienist-unfriendly things that we have going on. We need to rethink that.” That helps you understand stuff better before you proceed with it.
It’s such a mindset shift. When you think of everything in this different way that’s customer-obsessed and the reducing friction, it’s so much easier to think of what you’re going to do next.
You can challenge the status quo, which is your entire mantra.
We’re trying to because baseball is dying. It’s a traditional game that’s dying. I know a lot of readers always say we get deep and macro. I know it’s a mindset shift but is there a quick-win that you would give anyone that they can say, “After this, I’m going to do this to help my company to think like Amazon and be more innovative?”
I’ve already given you one, which is, think through your metrics, especially how you measure customer experiences. The second one I would take is this, which is when I go out and talk to audiences, I’ll always ask, “Who here believes that innovation and being more creative rethinking the customer experience is critical for your company over the next 5 or 10 years?” Ninety percent of the audience will raise their hand and I go, “How many of you have a deliberate technique or process in how you’re going about your innovation?” Almost no one will raise their hand. I call that working in the future.
You have to think about how am I going to put more time and be deliberate, systematic and have a technique and a process in how I work in the future. Otherwise, your innovation is an accident. You’re going to stumble into it. It’s not going to be systematic and it’s not going to be driven by the inputs that you put into it. The second takeaway I would have is if you want to innovate, you’ve got to have a technique to it. Think Like Amazon is a technique book. It’s how we do these things because we all recognize that we need innovation, but we don’t know exactly how to do it?
Can I give you one industry potentially and maybe an idea of how you can innovate it? Let’s have a little fun here, a little shown down. You can throw one at me too if you want it to be a showdown and we can have fun.
Let’s do it.
A gas station.
Why do I have to go?
It starts with a question.
Why do I go to a gas station and everything? That would be one thing I would think about relative to a gas station. The second thing is, with the COVID-19, a major concern, think about the hygiene at a gas station. If you want to improve the customer experience, make it trustworthy for a mom to go there and know that they’re not picking up strange stuff on their hands from pumping gas in their car. That’s an easy win.
You have the question and what if I didn’t have to go to a gas station? What if I didn’t have to? The big friction is, “I’ve got to go get gas.” Whenever you do something as a potential chore, there’s an innovation opportunity there, which I love. I’ve been grilling you for a while and you’re now the host of Business Done Differently. You can ask me one question. I flipped the script.
What would your recommendations be to MLB to improve the game?
We only have a few minutes. That would that’s a full conversation.
It’s a big question.
Here are the friction points. What’s happened with baseball right now are the games are getting longer and players aren’t connecting with the fans as much. We try to break down the barriers. Our players go in the crowd. They give roses to little girls. They go into dates with fans and they interact. There’s less celebration, there’s too much traditionalist. If you celebrate, you get hit and hurt. It’s a different game. For MLB, how do you break down the walls between the players to make it fun? How do you make the game much shorter and condensed? If you watch a major league baseball game, look into the crowd and look at how many people are watching the game.
[bctt tweet=”Addressing your risks early provides lesser room for surprises.” username=””]It’s less than half. Fifty percent are looking down. That’s not a good product. How do you make it where you can’t stop watching? We’ve been experimenting with some games where you can play nine innings in less than 90 minutes where you can’t take your eyes off it. We’ve had games like that where we want to do that because what would make the game that you don’t want to go get a soda? You want to watch it so much. You may lose revenue there a little bit, but isn’t that making a better experience and a better product so that’s a win?
It truly is an example where tradition, because we’ve always done things this way, is what’s holding them back from doing that. The steps and solutions are pretty well understood, but it’s a tradition that holds us back and that’s the same in so many businesses. It’s because we’ve always done things this way. That’s part of what holds us back from innovating.
You started with what would Jeff do? After you said, what would you do? That’s a question. What would you do to change the industry that either you’re in or what would you do? What if there are no barriers to make it a better experience? I do love questions. We’ve asked a lot. Question time, if you want better answers in business, you got to ask better questions. What’s another great question that you may be asking right now with your clients or anyone you’re working with?
What’s the silly upstart idea that’s going on now that if it were successful in 5 or 10 years, would completely change the nature of the environment that you operate in. In financial services and logistics, one of the silly ideas going on out there is around blockchain, smart contracts and more trustworthy, transparent transactions. A lot of these things have major challenges and issues too. If you ask the question, if these things got solved under what conditions of these things got solved for, how would that change business? That’s a different perspective.
Think about years ago in mobile commerce. Back then, nobody was envisioning mobile commerce, the cell phone coverage, and the cells themselves. The cellphones are going to get better. Assume that what sucks now isn’t going suck as much. What do you need to be doing? What are the opportunities now to prepare and take advantage of that versus, “The customers will never adopt the phones, they don’t work that well?” That’s an example of we’re taking something that isn’t working well now but if it didn’t work, it would fundamentally change things. That helps you think about things differently and what your long-term potential is.
I’m a positive person, but sometimes looking at what sucks right now and we can make it better. It’s a simple way of looking at it.
All those upstart ideas that seem silly now, if they worked, those would change the nature of our business.
Instead of, “What if it doesn’t work?” “What if it works?” It’s a great way. The final one here, if you were to give advice to someone on how to stand out in business or in life, what would you tell them?
Be an independent thinker. I’m fortunate that I’ve got two great boys and I had a great partner, my wife, in raising them. If there’s one thing that we’ve tried to install in them is be an independent thinker. It’s the independent thinkers that change the world. You want to listen to others and everything, but evaluate everything based on the facts of the situation versus what all the traditionalists are saying. That will lead you to better outcomes and a better life, honestly.
What a great way to end, go out and think differently. The book is Think Like Amazon. I have about half of the pages earmarked. It was outstanding. It made me think differently and challenge what we’re doing. John, thank you so much for being here and sharing some of your wisdom.
Jesse, anytime. This was great. It’s one of the better conversations I’ve had. Thank you.
I appreciate you.
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About John Rossman
Digital and innovation business model strategy, execution and scaling leader. Advisor to companies and leaders working to innovate and compete with more agility and effectiveness.
Leaders call me when they are looking to scale and improve digital or technology-driven strategy and operations. I help them envision and execute complex customer-oriented change, and differentiate themselves by the level of immediacy, control and customization they offer customers. I often advise on the process and culture of innovation and how to take bets in their business. I work across most industries including service, retail, social sector, high tech, telecommunications and others.
I am the author of three books:
– Think Like Amazon: 50 1/2 Ideas to Become a Digital Leader (2019, McGraw Hill)
– The Amazon Way: 14 Leadership Principles of the World’s Most Disruptive Company
– The Amazon Way on IoT: 10 Principles for Every Leader from the World’s Leading Internet of Things Strategies.
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