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The question: Amazon seems to be executing well lately -- is the company taking enough risks? Added the shareholder, "If it's still Amazon's philosophy to make bold bets, I would expect that maybe some of them wouldn't work out, but I am just not seeing that. So, my question is where are the losers?"Bezos answer is long and thoughtful, but nicely summed up in the first few sentences:
In a way, that is like the nicest compliment I've ever gotten. First of all, I think we have gotten pretty lucky recently. You should anticipate a certain amount of failure. Our two big initiatives, AWS and Kindle -- two big, clean-sheet initiatives -- have worked out very well. Ninety-plus percent of the innovation at Amazon is incremental and critical and much less risky. We know how to open new product categories. We know how to open new geographies.I really like how Bezos seems to recognize the distinction between invention (creation of a new thing) and innovation (adaptation of an existing thing to a market). Later in his answer he even says, "I believe if you don't have that set of things in your corporate culture, then you can't do large-scale invention. You can do incremental invention, which is critically important for any company. But it is very difficult [to make big bets on large-scale invention] -- if you are not willing to be misunderstood. People will misunderstand you." [Via James Gross]