Even though Amazon is, at its core, a technology company, Jeff Bezos built Amazon by focusing on things that don’t change.
And constantly seek to improve its delivery of those things.
I very frequently get the question: ‘What’s going to change in the next 10 years?’ I almost never get the question: ‘What’s not going to change in the next 10 years?’
It’s impossible to imagine a future 10 years from now where a customer comes up and says, ‘Jeff, I love Amazon; I just wish the prices were a little higher.’ ‘I love Amazon; I just wish you’d deliver a little more slowly.’ Impossible.
And so the effort we put into those things, spinning those things up, we know the energy we put into it today will still be paying off dividends for our customers 10 years from now. When you have something that you know is true, even over the long term, you can afford to put a lot of energy into it.
Oh, hell no
Some years ago I rode a Gran Fondo with a professional cyclist friend. (Since he finished nearly an hour ahead of me, “with” was mostly driving to and from.)
Heads turned when he rolled into the staging area. Greetings. Handshakes. Selfies.
Then a rather portly gentleman told him he was thinking about buying an expensive new bike. “A lighter bike will make a huge difference,” he said, clearly confident a pro cyclist riding the latest technology would agree.
My friend shook his head. “Oh, hell no,” he said. “Spending all that money just to get a lighter bike would be such a waste. If I were you, I would lose 10 or 20 pounds instead.”
“Maybe,” he said. “But too many people look for the next best thing instead of looking in the mirror, probably because it’s easier. Unless you’re at the top of the sport, equipment is the least of your worries. You have plenty of room to improve yourself first.”
Math and physics — if not tact — were on his side. In cycling, a rider’s power to weight ratio is a key factor. The greater your strength compared to your weight, the faster you will ride. And the less you weigh, the less energy you need to expend. (Not to get too wonky, but a 180-pound rider with a functional threshold power of 280 who then loses 15 pounds will gain around 25 watts of power — simply by losing weight.)
Clearly losing 15 pounds can make a much bigger difference than buying a bike a couple pounds lighter.
Plus, and this is key, how much we weigh is largely in our control. I may not have $9,000 to drop on a new bike. (Even if I do, there are probably better uses.)
But I can eat better. I can exercise more. Those things I can control. And — and this is also key — doing those things is good for me period: Not just for cycling, but for my overall health and wellbeing.
Power to weight matters. Power to weight will always matter. That won’t change. And that is something I can control to the extent that I wish.
Boiling things down to their fundamental truth
That’s what Elon Musk (and Aristotle before him) would call a first principle: “Boiling things down to their fundamental truths, and reasoning up from there.”
Another example? Investment returns. I know lots of people who scratch and fight and claw to generate an extra 1 or 2 percent on their stock investments. Makes sense: Where returns are concerned, more is better.
Yet no matter how hard you try, the rate of return you achieve is at least partly outside of your control. Markets, technologies, and politics constantly shift and evolve. Predicting the future with certainty is impossible.
But what can you control? How much you save — and, until you’ve amassed considerable wealth, how much you save matters more than the return you generate.
Say you make $40,000 a year and save 3 percent of your salary; that’s $1,200 the first year. If you earn a 4 percent return on that money, after one year you’ll have $1,248. If you double your rate of return to 8 percent, you’ll have $1,296.
Yet if you increase your rate of savings by just 1 percent, you’ll have $1,600 — before you generate any return at all.
Where wealth building is concerned, the most important thing you can do is to focus most of your attention on your rate of savings, not your rate of return. The more you save, especially early on, the more you’ll have later.
Until you’re worth hundreds of thousands of dollars, that fact will never change.
This means finding ways to cut three or four percent out of your budget, and saving that money, far outweighs finding ways to generate 1 or 2 percent greater returns.
As does losing a little weight instead of spending money on a new bike.
As does spending time mentoring and developing current employees instead of spending time and money to recruit and train new employees may not turn out to be an improvement.
As does putting a little more time into increasing the lifetime value of current customers instead of focusing solely on gaining new customers.
As does empower your employees by giving them the authority and autonomy to make more decisions instead of settling for the gross inefficiencies inherent in command-and-control leadership.
In almost every case, you can do more with what you already have and you can better control what you already have while you adapt and evolve, those facts never change.