- Amazon pushed for thrift in an all-hands gathering this week, according to Insider-reviewed snippets.
- “There are no extra points for growing workforce, budget or fixed costs,” according to a leaked slide.
- The comments hint at the tone shift at Amazon as it tightens its belt in the face of an impending recession.
Amazon’s leadership team this week urged employees to “double down on thrift” at an internal all-hands meeting, according to slides and excerpts viewed by Insider.
The slides instructed employees to “achieve more with less,” which means adjusting workforces, cutting costs, and lowering inventory levels.
“Limitations allow for ingenuity, self-sufficiency and innovation,” said one of the slides. “There are no extra points for growing workforce, budget or fixed costs.”
Specific strategies described in the slides included:
- Maintain cash balances and liquidity
- Adjust inventory levels to meet demand
- Reduce discretionary costs that are not tied to customers
- Customize recruiting based on business needs and priorities
- Prioritize customer experience over new initiatives
- Double economy
Brian Olsavsky, Amazon’s chief financial officer, said at the meeting that the company has nearly doubled its operational capacity from 2020 to 2021 and now needs to be more frugal to control costs, according to an employee present.
The comments signal a shift in tone at Amazon as the giant retailer tightens its belt in the face of slowing growth and a deteriorating economic environment. Amazon has always had a reputation for making more money than its lavish tech peers, but the recent economic downturn has put more pressure on the company to cut costs.
At the meeting, Amazon CEO Andy Jassy conveyed a similar message when asked about the economic downturn and its effect on Amazon’s future investments. According to a recording of the meeting obtained by Insider, he said Amazon will think more about its spending, although it will continue to invest in long-term betting.
“It’s in the minds of a lot of people, and of course nobody knows for sure what’s going to happen, but there are a lot of signs that this is a tough and rough economy for us,” Jassy said. “And I don’t know how long it will take, but I think one of the things that we’re thinking about and that we’ve decided is that by 2023 we’re going to be more streamlined in how we expand.”
Jassy pointed to several long-term initiatives, such as Alexa and groceries, that will continue to be funded, but warned Amazon will have to strike the right balance by being “strategically patient and tactically impatient.”
“One of the things that people sometimes do wrong is forget that healthy, long-term, sustainable businesses don’t really expand every year,” Jassy said.
In recent months, Amazon has halted a series of high-profile projects, including the Amazon Care telehealth service, and stopped testing the self-driving robot Scout. It’s significantly downsizing its robot team and Grand Challenge moonshots lab, as Insider previously reported. The company is also scaling back expansion plans for its warehouses and delivery partners.
“This is day 2 s–t,” an Amazon employee who attended the meeting with all hands told Insider, referring to Amazon’s “Day 1” mentality, a common refrain from Jeff Bezos that the company should always act like a startup. worn, how old it gets. Concerns about Amazon entering “Day 2” related to a slowing culture, additional layers of management and increasing red tape have been a growing concern among the company’s corporate workforce, Insider previously reported.
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Contact reporter Ashley Stewart via the encrypted messaging app Signal (+1-425-344-8242) or email ([email protected]).