Amazon founder and CEO Jeff Bezos launched an impassioned defense of his company’s workplace culture yesterday following a damning article published by The New York Times that claimed that working for the company ‘has turned into a world of frequent combat.’
Bezos, 51, issued a memo to all staff regarding the article, saying that it ‘doesn’t describe the Amazon I know’ and encouraging everyone within the organisation to read it and email him personally if they identified with any of the ‘shockingly callous management practices’ it claims are implemented at Amazon.
The New York Times claimed to have spoken to ‘more than 100 current and former Amazonians’ in composing their article, some of whom asserted that employees who had suffered severe personal misfortune, such as a miscarriage, a family illness or diagnosis and treatment for cancer, had been placed on performance improvement plans and had their suitability for their roles questioned. The article, published over the weekend, also depicted an environment in which employees were encouraged to criticize co-workers, were subjected to aggressive language on a regular basis, were chastised for not working or responding to emails at midnight or whilst on holiday, and in which women were disadvantaged.
The article also appeared to attribute the development of Amazon’s corporate culture to the personal ideology of its leader. Bezos is reported to believe that harmony is ‘often overvalued in the workplace’ and seen as the architect of the process of ‘purposeful Darwinism’, where only the highest performers are retained and there are annual ‘culls’ of staff. The article quoted a 2013 survey by salary analysis firm, PayScale, that revealed the median employment term for an Amazon employee at just one year, and claimed that Bezos was ‘conducting an little-known experiment in how far it can push white-collar workers, redrawing the boundaries of what is acceptable.’
Glenn Elliott, founder and CEO of employee engagement technology firm, Reward Gateway, and former design agency CEO, has been giving his view on the story. Elliot regularly uses Amazon as an example in his customer presentations and says that there are two types of companies that will thrive in the new ‘uber-competitive’ world: Those that engage their people and those that eliminate their people. Amazon is his prime example of the latter.
“Amazon executes brilliantly on their vision to be ‘the world’s most customer-centric organisation’ and, as a business model it is valid and effective to a point. However, they are prepared to be ruthless and are just about the only modern organisation that is like that. Driving people like that daily means the culture has started to show cracks”
Amazon’s Nick Ciubotariu, who heads infrastructure development at the company’s Seattle campus, took to LinkedIn on Sunday to post an emotive response to the New York Times in a blog that has now received over one million hits. He calls the article ‘blatantly incorrect’ and ‘uninformed’, and breaks it down in order to refute each claim made about Amazon’s work environment and culture. Ciubotariu’s post was referenced by Bezos in his company-wide memo the following day.
Glenn Elliot believes that there are lots of ways to be successful in business but success tends to be partial never complete. “You give up one thing to win something else. Amazon has nailed commodity sales, vast volume and thin margin, but not creativity and style, which so far has locked them out of some sectors like fashion and homewares”
In spite of failing to break into some markets, Amazon’s share price rocketed at the end of July after reported above expected performance figures and appears unaffected by these revelations. It remains to be seen if their ability to attract top talent will be impacted, but the company is still the largest online retailer in the United States and the world’s largest provider of cloud computing services, making it an attractive destination for many.
Learning from his own business, Elliot says, “To keep people happy and inspire them to do better, treat them like valued human beings not commodities and create and keep a common, positive and authentic culture that motivates employees.”