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A fact that counters your hypothesis: Amazon is obviously one of the most productive companies to have ever existed. *Edited: Turns out I have been misusing th
by xibalba 5y ago
A fact that counters your hypothesis: Amazon is obviously one of the most productive companies to have ever existed.
*Edited: Turns out I have been misusing the word "counterfactual" for quite some time.
- retrocryptid 5y agoBy what measure of productivity?
- xibalba 5y agoAlmost any mainstream business metric. Here is a brief and incomplete sample: Revenue, net income, employee head count, customer satisfaction, customer retention, customer lifetime value, return on invested capital, end price reduction for customers, stock price and market capitalization, SKUs available for sale, new products/services launched, etc etc.
- void_mint 5y agoThe "productivity" of a company by these definitions is almost totally unrelated to the productivity of its employees. Amazon could downsize by 90% and most of these would still hold up.
- NathanKP 5y agoAs a current Amazon employee I have to say that is pretty ludicrous. If you actually think Amazon could scale back to 10% of it's current employees without losing massive forward momentum and capacity to deliver results then I don't know what to say. All those metrics would suffer greatly in both the short and long term. In order to scale back that far without suffering negative results you'd have to assume that those 90% of people aren't doing much day to day, so their loss would not be felt, and that is frankly not true and kind of insulting to the hard work that Amazon employees do.
- void_mint 5y agoIf a company makes a lot of money, does that mean every employee is responsible for generating the money they made? Is it possible to make a lot of money with not a lot of employees? Does Amazon make less money when employees take a lot of PTO? I'll add 90% was hyperbole.
- xibalba 5y agoJust to be clear, I am using the word "productivity" in a very general sense: output over input. I'm not sure I understand your reasoning. How would any of these metrics not rapidly collapse under a 90% workforce cut? Are you assuming that the majority of Amazon is somehow automated? It definitely isn't.
- frumper 5y agoIf Amazon downsized by 90% then they couldnt drive by my house two to three times a day so I can quickly get my prime widgets.
- astrange 5y agoThose aren't employees, so it's ok as long as they keep the capital assets. (I think.)
- dimitrios1 5y agoBy those metrics, IKEA fits the bill as well. But at what point do we qualify productivity with some measure of quality? You'd be hard pressed to argue IKEA produces quality. For all the laurels and new features and gadgets and gizmos have produced, very few AWS offerings or new Amazon products are considered best in class.
- ptudan 5y agoTop of market quality is obviously not IKEAs goal. There is no one in IKEA corporate who would argue differently. IKEA makes cheap, good enough furniture. Similar to Amazon's approach. You can't argue that either is not hitting a certain high quality bar when neither are striving for it. Disclaimer: I work for AMZN
- rightbyte 5y agoIkea has more similarities with Apple than Amazon. Amazon is a mishmash of stuff being sold, like Dollarstore or whatever. Ikea is more like the Apple store. Ikea is a streamlined and well thought out experience.
- dimitrios1 5y ago> Ikea is a streamlined and well thought out experience. It's so fascinating how diverse people's viewpoints are! My first experience of IKEA was that it was a confusing, frustrating, poorly laid out and inefficient labyrinth designed to get you lost, and also funnel you to the "hot dog" items that make them the majority of their profit. I've taken many of my parents and observed similarly people's parents and grandparents of friends get just as frustrated and confused at the layout. For god sakes, I just want to be able to walk in, go to the "kitchen decor" get what I need, and walk out. I don't want an "experience", but I digress.
- influx 5y agoWhat cloud provider is better than AWS?
- retrocryptid 5y agoand then you divide it by # of employees and get something kind of low.
- Brian_K_White 5y agoDoubt it
- ipaddr 5y agoCustomer lifetime value for non-prime members is under $1,000, $2300 for prime. Not exactly the leader. Amazon has 12 million skus walmart 75 million. End price reduction? Amazon is rarely the cheapest. Employee headcount, is more or less better? Things always seem rosier.
- asdfman123 5y agoAnd Amazon is very successful because it has dominated one of the main reasons we use the internet: online shopping. Comparing online shopping revenue to social media revenue kind of feels like comparing apples to oranges to me.
- HarryHirsch 5y agoThe stock price, of course. Yesterday, in another thread about Amazon, someone described that the reason AWS works at all is the size of their firefighting team. It's the exact opposite of progress, why advance the state of the art when you have access to a large pool of cheap labour.
- retrocryptid 5y agoHow does AWS advance the state of the art with undocumented services that frequently fail? I'm not a big fan of Azure, but at least they document their services.
- NathanKP 5y agoWhich services in specific are undocumented services that frequently fail?
- xibalba 5y agoThe size and growth of AWS' customer base and financial success is a very strong counterargument to your claims. Is it possible you are confusing your personal preferences for the goals of the AWS business? AWS may seek to advance the state of the art, but this is not the end goal, per se, but rather one factor that may or may not achieve the end goal. The end goal is more customers and greater revenue and profit. > someone described that the reason AWS works at all is the size of their firefighting team Customers don't care all that much why AWS "works". They care that it "works". And, again, it "working" is not their end goal. Rather, AWS "working" is yet another means to an end.
- HarryHirsch 5y agoThe reason why industrialization took off in Britain and not in India or China is unclear, but a regard for science, an undersupply of labour and internal stability all play a role. You don't have any of that at Amazon, there is firefighting instead of research, they aren't running out people willing to work for them yet, and personnel turnover is stratospheric. Yes, they do make money, but you can't buy advancement.
- maurys 5y agoI've always wondered about this. I'd expect this to catch up with Amazon and not work out in the long term. But their stock price keeps going up and they keep eating up new markets.
- tines 5y ago> Amazon is obviously one of the most productive companies to have ever existed. Strictly speaking, I don't think this is a counterfactual. A counterfactual is a figure of speech that considers a situation wherein the facts are different than they really are. For example, "If I were you, I'd quit." This is a counterfactual, because I am not you, but if I _were_, then so-and-so would be the case. Google gives the example, "If kangaroos had no tails, they would topple over."
- xibalba 5y agoIndeed, you are correct! *blushing face emoji*. Edit made. Thank you!
- retrocryptid 5y agoWorker productivity is measured as "amount of goods" over number of employees. If you say "revenue" is the same as "amount of goods" then Amazon gives you: 386.1b dollars / 798k workers = $483,834.58 / worker That's impressive, but... Alibaba: $717.3b / 251k workers = $2.8m / worker FlipKart: $436.2b / 30k workers = $14.5m / worker Texas Instruments: $14.38b / 30k workers = $468k / worker G.E.: $75b / 174k workers = $431k / worker I would agree with your assertion that it is one of the most productive companies to have ever existed, but so are a lot of other companies and they don't seem to hire people just to fire them later. And heck, the last company I worked for was a small firm capitalized with several tens of thousands of dollars from its founders followed by a $75k angel round. Its revenues last year were around $38m with a staff of about 45 people or around $800k / worker. And they achieved it with a couple orders of magnitude less investment than AMZN.
- nkssy 5y agoThey will fail in multiple ways and this will be a factor in what eats them out like a cancer. But it will take decades so really is it an issue for them? Unlikely. They'll still be profitable. It won't necessarily kill them either. Its the equivalent of the corporation being a person smoking cigarettes. It imparts some benefits and doesn't kill right away but given enough time it still causes disease. They'll start to miss opportunities. They'll run slower. The metaphor vanishes in a lot of ways though because the corporation can pivot and simply say "we were wrong". Microsoft is a perfect example. It regularly threw away people and this caused damage and various big failures but not enough to scuttle them. They are still successful. Still growing. Students of history know that Microsoft's story of success hides a lot of messy details including behavior where plenty of law had to get involved. Amazon will go down a similar path. Or has likely already begun.
- GVIrish 5y agoAmazon can be one of the most productive companies ever, and still be doing self-sabotaging things that will erode their long term success. Truth is that any given time no company is perfect, they can simultaneously being doing things that give them an advantage in the market and doing things that undermine their own efforts. As long as the advantageous stuff outweighs the self-sabotage, they can be successful. Some of the trouble is that people see success and assume that 100% of the things they are doing are the correct thing to do. Not considering that maybe the reason they can get away with one sort of bad behavior is because they have such a huge advantage in some other area. So for Amazon, the soaring stock price serves as a big financial incentive that allows some employees to overlook the work environment. But that may not always be the case, and the more people share negative experiences about the work environment, the more new people avoid joining altogether. The negative reputation and the turnover may not be enough to doom the company, but on the flip side they'd probably be even more successful in the short and long term if they didn't have a firing quota.
- TameAntelope 5y agoI would go so far as to argue our assumption about Amazon even wanting to "maximize" productivity may not be correct. It may make sense to guarantee a certain lower-than-maximum productivity than to shoot for a more risky absolute-maximum-at-all-times and sometimes miss that shot, and this system goes for the former.