The Virtual CMO Podcast

Season 8, Episode 4

In episode 119, host Eric Dickmann talks with John Rossman - Founder and Managing Partner of Rossman Partners, a digital transformation marketing agency. Previously, John served as an executive at Amazon.com where he played a key role in launching the Amazon Marketplace business as the Director of Merchant Integration and went on to have responsibilities for the enterprise business.  He leverages Amazon's leadership principles to help others innovate, compete and win in the digital era. John is also the author of "The Amazon Way: Amazon's 14 Leadership Principles" and writes a weekly newsletter titled "The Digital Leader Newsletter" on Substack. You can connect with John on LinkedIn and Twitter.

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Amazon’s 14 Leadership Principles

1. Customer Obsession - Leaders start with the customer and work backward. They work vigorously to earn and keep customer trust. Although Amazon leaders pay attention to competitors, they obsess over customers.
2. Ownership - Leaders are owners. They think long-term and don’t sacrifice long-term value for short-term results. They act on behalf of the entire company, beyond just their own team. They never say “that’s not my job.”
3. Invent and Simplify - Leaders expect and require innovation and invention from their teams and always find ways to simplify. They are externally aware, look for new ideas from everywhere, and are not limited by “not invented here.” As we do new things, we accept that we may be misunderstood for long periods of time. It’s not an experiment if you know it’s going to work.
4. Are Right, a Lot - Leaders are right a lot. They have strong business judgment and good instincts.
5. Hire and Develop the Best - Leaders raise the performance bar with every hire and promotion. They recognize exceptional talent and willingly move them throughout the organization. Leaders develop other leaders and take seriously their role in coaching others.
6. Insist on the Highest Standards - Leaders have relentlessly high standards, so high that many people may think these standards are unreasonably high. Leaders are continually raising the bar and driving their teams to deliver high-quality products, services, and processes. Leaders ensure that defects do not get sent down the line and that problems are fixed so they stay fixed.
7. Think Big - Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold direction that inspires results. They think differently and look around corners for ways to serve customers.
8. Bias for Action - Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk-taking.
9. Frugality - We try not to spend money on things that don’t matter to customers. Frugality breeds resourcefulness, self-sufficiency, and invention. There are no extra points for headcount, budget size, or fixed expense. Frugality drives innovation, just like other constraints do. One of the only ways to get out of a tight box is to invent your way out.”
10. Vocally Self Critical - Leaders do not believe their or their team’s body odor smells of perfume. Leaders come forward with problems or information, even when doing so is awkward or embarrassing. Leaders benchmark themselves and their teams against the best.
11. Earn Trust of Others - Leaders are sincerely open-minded, genuinely listen, and are willing to examine their strongest convictions with humility.
12. Dive Deep - Leaders operate at all levels, stay connected to the details, and audit frequently. No task is beneath them.
13. Have Backbone; Disagree and Commit - Leaders are obligated to respectfully challenge decisions when they disagree, even when doing so is uncomfortable or exhausting. Leaders have conviction and are tenacious. They do not compromise for the sake of social cohesion. Once a decision is determined, they commit wholly.
14. Deliver Results - Leaders focus on the key inputs for their business and deliver them with the right quality and in a timely fashion. Despite setbacks, they rise to the occasion and never settle.

Highlights from Our Conversation with John:

“The kind of approach that I would recommend in building your principles is to etch these in jello, try them out, use them. It's so critical to get the executive team modeling these and holding each other accountable for them. And that's how real culture change happens, from an intentional leadership standpoint.”

• [00:06:52] Amazon wasn't always this big as you see it today- Don't think of Amazon as the Goliath we know today, whether it was a team of 100, 1,000, 10,000, 100,000. The team fought about the situation and held each other accountable with the same approaches. Back then, even if they were small, Amazon had to be extremely frugal and use that as a constraint to innovate. The financial constraint, however, didn't hold them back from their goals and vision.
• [00:09:25] What's your thought on customer obsession?- John Rossman says there are two types of customer obsession- tactical and strategic. The tactical customer obsession is about getting today's customers the promise you're making as perfect as possible. It is driving all of your operational excellence, and value proposition, and measuring every aspect of that customer experience. On the other hand, strategic customer obsession helps you look up and down the customer value stream, find new ways of understanding your customers, and have more empathy for them beyond just your product and your service.
• [00:13:08] Invest and simplify- John believes that the invention piece always fascinates people and sounds really hard. But what marketers should realize is that the simplification aspect is both as important and as hard as inventing. You need to rethink the discovery moments for a customer, and that really is oftentimes simplification work that needs to be done.
• [00:19:18] How do you advise leaders to take those necessary risks?- Most decisions are two-way door decisions. They should be made with a bit of discussion, intuition, and speed because if we break down these decisions into more of a test and adapt test and learn mindset, the speed element becomes more valuable than just continual studying.
• [00:21:50] How do you balance that bias for action with frugality and ensure you're not just spending?- The spirit of the principle isn't about being cheap. It's about using resources smartly and using resource constraints as a force to help you innovate. Doing more with less is actually the mindset that helps you innovate. You use constraints to come up with a better and more efficient approach to accomplish what you need to get done.
• [00:25:50] How did Amazon build that trust and what leadership lessons would you give to earn it with their employees?- Amazon's entire strategy was built on customer trust. They took an element like customer trust, put it into specific terms, then measured and designed around it, and that helps make these elements critical and manageable to a business.
• [00:28:39] How do you advise leaders to deliver the results and design around that?- One of Amazon's leadership lessons emphasizes focusing on the critical inputs for the business and delivering them with the right quality in a timely fashion, despite setbacks. Decision-making is about taking the time to write them out and then debate them as a team. You have to be clear about what you're saying yes to, and as importantly, what are the good ideas we're saying no to for now?

Leadership Lessons and Other Resources Mentioned

• Rossman Partners- Company Website
• The Amazon Way: Amazon’s 14 Leadership Principles- Book

Live Stream on YouTube