At Amazon the Flywheel Effect drives innovation

When Amazon CTO Werner Vogels talks about his company’s philosophy around innovation, it’s probably a good idea to listen. Amazon CEO and founder Jeff Bezos has always found a way to capitalize on technology trends, whether being an early online retailer, seeing the future of cloud computing and forming Amazon Web Services, or developing delivery drones and commercial rockets.

Speaking at BoxWorks this week, Vogels says his company relies on several key building blocks and the ‘Flywheel Effect’ to maintain its technology edge. The Flywheel Effect is the idea that once you have your core tech pieces in place, they have an energy of their own that drives other positive changes and innovations.

“You have to do a lot of innovation that sits under the covers. Anything you do like this will become a flywheel and will drive innovation,” he said.

You have to do a lot of innovation that sits under the covers. Anything you do like this will become a flywheel and will drive innovation. Amazon CTO Werner Vogels

“We’ve built stuff nobody has built before with development process and methodologies that didn’t exist,” he said. Early on, when Amazon started AWS, the cynical wondered who would want to buy storage from a book shop. Vogels said that the idea that Amazon was a retailer, because that’s what it was at first, really stuck in everyone’s mind.

“We may be a retailer, but we are a tech company at heart. When Jeff started Amazon, he didn’t start it to open book shop. He was fascinated by the internet,” Vogels explained.

Vogels says whatever they do at Amazon, it all starts with the customer and they work backwards from that. In practice, that means whatever they create there are five pillars supporting every move including security, performance, reliability, scalability and cost. He says the company is continually innovating those five core services.

He says when you combine these principles with a customer-centric approach good things are going to happen. Vogels says working for Bezos, there isn’t a week that goes by that he doesn’t learn something. “He’s an amazing thinker and strategist, and an amazing visionary.”

The biggest lesson he’s learned from Bezos is that you must have a vision whatever you’re doing. He says Bezoz describes two types of companies: missionaries and mercenaries.  Mercenaries build products with a sale in mind, while missionaries build products because they believe deeply in the products.

“We are missionaries. It’s why do we do innovation, to make life better for our customers.” Vogels said.