File

Case

HOW JEFF BEZOS MANAGES AT AMAZON.COM

In 1994, Jeffrey Bezos, a computer science and electrical engineering graduate from Princeton University, was growing weary of working for a Wall Street investment bank. His computer science background led him to see an entrepreneurial opportunity in the fact that Internet usage was growing at an accelerating pace. Bezos decided that the online book-selling market offered an opportunity for him to take advantage of his technical skills in the growing virtual marketplace. Determined to make a break, he packed up his belongings and drove to the West Coast, deciding while en route that Seattle, Washington—a new Mecca for high-tech software developers, and the hometown of Starbucks’s coffee shops— would be an ideal place to begin his venture. Bezos’s plan was to develop an online bookstore that would be customer friendly, easy to navigate, and offer the broadest possible selection of books at low prices.54 Bezos realized that, compared to a real “bricks and mortar” bookstore, an online bookstore could offer customers any book in print; his task was to provide online customers with an easy way to search for and learn about any book in print. Working with a handful of employees and operating from his garage in Seattle, Bezos launched his venture online in July 1995 with $7 million in borrowed capital.55 Within weeks, he was forced to relocate to new, larger premises and hire additional employees, as book sales soared. The problem facing him now was how to best motivate and coordinate his employees to best meet his new company’s goals. His solution was to organize employees into small groups and teams based on the work tasks they needed to perform in order to satisfy his customers. First, Bezos created the information technology (IT) team to continue to develop and improve the proprietary software he had initially developed. Then he formed the operations group to handle the day-to-day implementation of these systems and to...