MEET ANDY JASSY, AMAZON’S NEXT CEO (3mins read)

Filed in Internet by on May 28, 2021 0 Comments

Amazon.com For the first time in the company’s 27-year history, Amazon is getting a new CEO: cloud computing chief Andy Jassy, who will take over for co-founder Jeff Bezos later this year. Jassy, the current CEO of Amazon Web Services (AWS), is a firm believer in Bezos’ business principles and a company veteran, having led the cloud division since its inception nearly two decades ago.

Jassy, who turned 53 last month, now has the chance to make his mark not only on Amazon but also on the world and the major ways the company has shaped it, from Whole Foods to a million-person-plus warehouse workforce to massive logistics and AI divisions with far-reaching real-world effects.

Despite not being a household name, Jassy is one of Amazon’s most influential executives. His promotion emphasizes the significance of cloud computing to the biggest tech titans, who now play critical roles in powering the entire internet. In the case of AWS, this includes everyone from Netflix and Spotify to the CIA and the Democratic National Committee. When AWS goes down, a large portion of the internet goes down with it.

The power shift is similar to Satya Nadella’s promotion to CEO at Microsoft in 2014 after Nadella spent three years running the company’s Azure cloud business. With a focus on cloud and mobile computing, as well as an excellent eye for major acquisitions, Nadella modernized many aspects of Microsoft’s a business and company culture. Jassy’s ascension to the top job at Amazon may also usher in a period of transformation for the e-commerce behemoth.

The big question Amazon insiders and those on the outside looking in will try to answer in the next six months before he takes the job in the third quarter is whether Jassy deviates from Bezos’ approach or sticks to business as usual. However, if Jassy continues to see himself as an acolyte of Bezos and his famous “Day 1” mentality — which contends that companies begin to decline and die the moment they rest on their laurels — it will mean that a lot of change is on the way. Change is both Amazon’s most important survival instinct and its most effective business tool.

When Jassy joined Amazon in the late 1990s, the company had been thinking about the cloud for years and was still solely focused on e-commerce. Jassy graduated from Harvard Business School in 1997 and soon after joined Amazon as part of a wave of fresh MBAs flocking to the tech industry prior to the dot-com boom. According to an interview last year on The Disruptive Voice podcast, Jassy moved out West with the intention of one day returning to New York, but he’s never worked for another company.

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According to an Insider profile of Jassy published late last month, he went on to become Bezos’ first “shadow” adviser, akin to a corporate chief of staff who followed the CEO around every day and sat in on all of his meetings. According to Brad Stone’s 2013 book, The Everything Store: Jeff Bezos and the Age of Amazon, Jassy made an unusual first impression on his boss by accidentally hitting him in the head with a kayak paddle during a typically competitive game of company broomball.

Bezos and Jassy’s relationship grew stronger in the years that followed, with Bezos tasked with researching the then-nascent technology of cloud computing around 2003. The goal was to determine whether it made sense for Amazon to provide hosting services to other websites and businesses at a time when many of the largest tech companies relied primarily on third-party data centres or had already begun investigating or actively building their own. Three years ago, Amazon struggled to build an external development platform for retailers so that third-party companies could build their own e-commerce operations.

Jassy was instrumental in identifying the issue: Amazon’s development tools were, to put it mildly, abysmal. The company set out to improve them by developing more user-friendly APIs and other technology that would allow any team at Amazon to access a shared pool of resources. According to TechCrunch, Jassy told a crowd at the re: Invent conference in 2018: “So very quietly around 2000, we became a services company with really no fanfare.”

It took another six years of exploring and experimenting for Amazon to launch its first cloud product in 2006, with the effort to formally develop AWS really taking off after a fateful 2003 executive retreat at Bezos’ house, according to Jassy. “In retrospect, it [AWS] seems fairly obvious, but I don’t think we ever really internalized that at the time,” Jassy said at re: Invent. Early investments by the company paid off, as competitors took years to recognize the business opportunity and launch comparable cloud products.

“If you believe companies will build applications from scratch on top of infrastructure services, and we believed they would if the right selection [of services] existed, then the operating system becomes the internet, which is very different from what had been the case for the [previous] 30 years,” Jassy explained.

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That prediction about the internet’s future proved correct. Today, AWS powers the vast majority of apps, services, and websites that consumers and employees use on a daily basis, owing to Amazon’s unparalleled resources and developer tools that make building and accessing its massive resources as simple as using a standard API. That is why so many businesses choose AWS or one of its competitors over building their own data centre operations. Unless you’re Facebook or Google, which have both built out their own global data centre operations, it’s simply easier to use Amazon than it is to do it yourself.

JassyJassy deserves credit for architecting the company’s cloud vision, having run AWS since its inception and becoming CEO after Bezos promoted him from a senior vice president role in 2016. During his tenure at AWS, cloud computing has also become the most profitable of Amazon’s divisions, accounting for roughly 63 per cent of the company’s profits in 2020 and putting it on track to generate more than $50 billion in revenue this year. According to Synergy Research, Amazon now controls roughly one-third of the entire cloud infrastructure market, more than its closest competitors (Microsoft and Google) combined.

Amazon may not have had the resources to invest as much money back into its retail, logistics, streaming video, hardware, smart home, AI, and other divisions over the years if AWS had not grown so rapidly. As a result, AWS is effectively the engine that drives Amazon’s constant reinvention, and Jassy is the spark that helps drive it.

Jassy has clearly positioned himself as Bezos’s heir apparent in recent years, spinning tales of Amazon’s early days and the remarkable beginnings of AWS, as well as how those lessons can be applied to other businesses. He’s a keynote speaker at Amazon’s high-profile re: Invent conference, a cloud computing industry gathering, and he’s become a more public face of Amazon in recent years. When longtime logistics executive Jeff Wilke, another possible Bezos successor, announced his retirement last summer, the writing was on the wall. Someone would eventually succeed Bezos, and Jassy appeared to be the most likely candidate.

Assy’s management quirks and persona, like Bezos’ infamous email style and meeting decorum, have become somewhat legendary within the company. According to Insider, Jassy is known internally for his meticulous attention to detail and hands-on approach, his penchant for back-to-back meetings, and his open embrace of social justice issues.

He publicly tweeted about accountability for the death of Breonna Taylor in September, and he has been vocal about his support for the Black Lives Matter movement and LGBTQ issues. Jassy, on the other hand, is well-known for defending contentious decisions, such as Amazon’s sale of allegedly flawed facial recognition technology to police departments and the government. (Amazon announced a one-year ban on selling the technology to law enforcement in June of last year.)

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Jassy’s approach is also known for making difficult and unprecedented decisions, as evidenced by AWS’ decision to ban social media platform Parler last month in the aftermath of the US Capitol riot. Insider reported at the time that the move was not taken lightly by the company, given its “religious” commitment to maintaining customer service. However, Amazon felt compelled to do so in response to employee outrage and because Parler posed a “very real risk to public safety,” according to a statement issued at the time.

 

Jassy will undoubtedly be in charge of making even more difficult decisions in the future. But that’s part of the job, as well as the Amazon culture he’s helped to foster. “It’s really difficult to build a business that lasts for a long time,” Jassy told a virtual audience at Amazon re: Invent last December. “To do it, you’ll have to reinvent yourself, and you’ll often have to reinvent yourself several times.”

That is exactly what Amazon has done over the years, evolving from an online bookseller to an e-commerce behemoth, then into a hardware manufacturer, a major Hollywood and entertainment industry player, and now the country’s second-largest employer. Jassy has been working behind the scenes to ensure that AWS continues to grow into the profit machine that it is today.

“YOU WANT TO ALWAYS BE REINVENTING.”

Now, Jassy appears to be ready for his own reinvention, at a time when Amazon remains at the forefront of so many industries and continues to explore new territory, all while facing increasing antitrust pressure in the United States and abroad, as well as mounting competition in the AI, cloud, and e-commerce industries.

“Typically, you see desperate reinvention — companies on the verge of collapsing or going bankrupt, deciding they must reinvent themselves. It’s a crapshoot whether you’ll be successful or not if you wait until that point,” Jassy explained. “When you’re healthy, you want to be reinventing yourself. You want to be constantly reinventing yourself.”

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