Habits: Five Product Best Practices Learned at Amazon
Key Takeaways:
The Five Best Practices are
Quantify (everything)
Know Your Metrics
Develop a Strategy
Customize Communications
Keep It Simple
How to Read this Article
My goal is to provide actionable advice. To that end, for each of the five best practices, I share:
The Learning
Amazon Support System
Rules of Thumb
Suggested Reading
The key concepts are in bold, so if you just want a quick skim, feel free to jump to those.
Background
This is the third post in a three-part series on what I learned at Amazon, as viewed through the lens of the NeuroLeadership Institute (NLI) Framework: Priorities, Habits, and Systems. I wrote these articles to explain the importance of building systems within your teams that support communication, measurement, and strategic planning habits.
Who Should Read This
Product Leaders seeking to understand best practices
PMs who want to understand Amazon
Ex-Amazonians seeking to implement Amazon best practices in a new environment
If you find this article helpful, I suggest you also read:
Table Stakes, Not Options
During my time at Amazon, I developed some fairly strong product management habits that have withstood the test of time. I have taught them to the teams I lead, and I’m sharing them with you now in the hopes that they will help you on your own Product Management (PM) journey.
For me, the most important thing was not just the habits I learned, but the supporting systems in place that made each habit second nature. This is the key to creating best practices that really take hold: a force of habit supported by proper product systems. The practices listed here encourage PMs to embrace challenges, persist in the face of setbacks and learn from both successes and failures.
I frequently find myself explaining why these five habits are table stakes, not options, for good product managers. They are:
Quantify (everything)
Know Your Metrics
Develop a Strategy
Customize Communications
Keep It Simple
The Habits
1. Quantify
“If you think you know something about a subject, try to put a number on it. If you can, then maybe you know something about it. If you cannot, then perhaps you should admit to yourself that your knowledge is of a meager and unsatisfactory kind.” - Lord Kelvin (paraphrased), 1893
The Learning
Everyone at Amazon is taught to quantify and measure how their product meets the customer’s best interest. To prove their team is delivering results, a PM must measure the inputs and outputs of the product. Colleagues reinforce this quantification culture when they challenge you to provide an ROI for your ideas. Bias for action drives everyone to quantify what has been accomplished. When you disagree and commit, you must come to the table quantifying your position, backing up your argument with data.
Building Trust
PMs who can quantify and measure problems and opportunities can better prioritize and tell a story. You earn trust when you can quantify the “why” behind your actions. Developing at least a quick ROI for a request, helps PMs prioritize and earn the respect of the teams they must influence; they must be able to explain why a request supersedes existing priorities. Engineering partners should—and will—push back on improperly quantified requests.
The Amazon Systems in Support
At Amazon, Weekly Business Review (WBR) metrics review meetings require PMs to quantify and measure. The standard format of all communications requires measurements and quantification with every message. The operational planning process is all about quantifying and measuring to size up the opportunity you are proposing be funded.
Rules of Thumb
Start with S.M.A.R.T. goals
SMART stands for Specific, Measurable, Attainable, Relevant, and Time-Bound. At Amazon, everyone has S.M.A.R.T. goals. You live and breathe them. They allow you to speak to where you stand against plan.
For Example: Increase Customer Engagement from 20MM in 2018 to 40MM in 2019, achieve a YoY increase of 100% by introducing ABC feature, launch XYZ widget by 12/31/2019. (How to Write Smart Goals)
Use adjectives and adverbs sparingly
Adjectives (“What kind?”, “Which?”, “How many?”) and adverbs (“how,” “when,” “where,” and “how much”) are typically considered filler words. You need to be more specific. Consider putting numbers where you might otherwise use adjectives or adverbs.
For example: “The program greatly improved customer engagement” doesn’t fly, because it doesn’t give quantifiable information. A better way to phrase it might read, “The program improved customer engagement by 20 percent, a YoY increase to 120MM from 100MM.” (Learn more about low-calorie words to avoid.)
Suggested Reading
2. Know Your Metrics
Metrics, or Key Performance Indicators (KPIs), enable product owners to track the performance of a product over time.
The Learning
Why are these important?
Because PMs don’t just need to quantify everything; they also need to know how their product is performing every day. Amazon PMs dive into their metrics to see what they are telling them about customer needs. Amazon PMs can speak to the current state of their products without breaking a sweat because they know their metrics.
This is not just about using numbers for the sake of using numbers. Rather, it’s about being able to talk about how a product is performing at any moment. PMs who understand their metrics are able to quickly tell a story to anyone who asks them about the product. They are prepared to connect the dots and see opportunities in unexpected places. They can make the case for extra resources or partnership opportunities. They see problems coming before there are emergencies.
Easier Than You Think
For the uninitiated, it sounds intimidating. But after about 4 to 6 weeks of looking at product metrics closely, habit and intuition are formed.
The Amazon Systems in Support
Weekly Business Review (WBR) metrics meetings are the strictest enforcement of ‘know your metrics’ at Amazon. Your weekly callouts and operational planning documents must contain metrics or will be considered incomplete communications. You use your metrics to make the case for funding your product.
Rules of Thumb
Understand inputs (levers) and outputs that drive outcomes Amazon PMs organize metrics around things the team owns and controls. These inputs are often called “Levers”. Actively monitoring one or two company-wide metrics for context is fine, but a team needs to measure what it can control and impact.
What are inputs, outputs, and outcomes? I like to use email campaigns as a simple example of inputs and outputs.
The number of emails sent is a simple input, or lever, that you control.
The number of emails read would be an output of your email campaign.
The outcomes you are seeking might include, for example, increased brand awareness and product sales.
You can use counts and attribution models to measure your desired outcomes.
Don’t forget counter guardrail metrics. Be careful. Don’t forget to measure what the team doesn’t want to break. Do a pre-mortem to think through the unintended consequences of your push to desired outcomes. Create a guardrail metric and keep an eye on it, along with your key metrics, to make sure that no important user behaviors are being negatively impacted.
Suggested Reading
3. Develop a Strategy
Every PM displays ownership when it comes to their strategic product plan. A quick Google search for Amazon OP1 (Operational Planning Process) will offer up many references to the somewhat involved process of building a strategic plan for the coming year. From inside Amazon, the process seems brutal, but many ex-Amazonians find themselves craving it. The rigor helps the entire team, and all stakeholders, unify around a clarified vision. It makes cutting poor performers and doubling down on the right bet easier.
The Learning
If you can learn to quantify everything and keep up with product metrics, setting a strategic vision will be easier than you think. This is especially true when there are tools (processes and procedures) in place to support the habit.
The Amazon Systems in Support
The OP1 process, Operational Planning, exists as an outright requirement at Amazon. It is drilled into you that it must be done to justify your product development for the coming year. This all teaches not only the best business practices but also proper roadmap planning. Don’t be deceived by the term ‘Operational Planning’ it is a strategic roadmap.
Rules of Thumb
Set Visions and Tenets. The exercise of stating a vision and tenets before developing a strategy helps set boundaries in which to ideate. A vision statement is a declaration of the team’s and product’s objectives. The tenets are a list of principles that guide the team, which make it clear what a team does or doesn’t do while using an inclusive tone.
Ideate Early. Set aside time to ideate with the engineering and design teams long before crunch time. Develop some problem statements and run some brainstorming sessions before you think you need them. Create an environment where coming up with big, crazy ideas is rewarded. This will lay the groundwork for more inclusive planning and bigger thinking.
Learn from Mistakes. Before jumping into the next big idea, take the time to list Hits (team wins), Misses (mistakes) and Learnings (lessons in the gray spaces or the overlap). As a PM documents these, using the ideation sessions as a backdrop, the vision for the coming year will come into clearer focus.
Suggested Reading
4. Customize Communications
PMs don’t work alone, but they display ownership when they spearhead communication. PMs need to communicate their product status to a wide variety of stakeholders.
The Learning
Partners and colleagues are too busy to follow every move of every team. Other PMs might benefit from your product; however, they don’t have time to chase details. Or maybe they have ideas that might make it better. Meanwhile, leadership can better help position resources and/or attention if they can quickly keep up with a team’s work.
This is why weekly and monthly updates on your product are essential. Daily updates on high-profile efforts are highly advised.
Don’t just send out a list of projects. Always explain and quantify how projects drive outcomes, as well as successes, failures, and the learnings they produce.
The Systems in Support
At Amazon, Stakeholder communication is drilled in your head in your first week when you are told to make sure you start sending Weekly Callouts to all your stakeholders. The format of this email has been built over the years and so has been tried and tested. It is not just a list of what but the product why. It focuses on the outcomes you are driving and owning.
Rules of Thumb
Weekly Communication: Metrics and Milestone Updates Consider metrics updates and product callouts as your minimum weekly communication requirements. On Monday, you should be looking at key metrics from the previous week so as to inform leadership and decide if a pivot or reprioritization is in order.
Product Callouts should feature key goals and metrics, notes on learnings, and successes or failures for the week. You should also make sure to include credits to the team, especially any engineers who pulled out all the stops. Yes, it is a lot of work, but it is a PM’s job.
Introclusion = Introductions + Conclusion. Get in the habit of telling readers what they are about to read and what they should conclude about the problem or solution. Or, to borrow from a McKinsey framework: Situation, Complication, Implication.
Unlearn Habits from School: Our excellent English teachers taught us to state our hypotheses at the top of our reports and the conclusions at the bottom. We strive to give the reader a chance to come to their own conclusion using the facts we share along the way. In the busy business world, however, executives want to quickly understand two things: “Why should I care?” and, “What are you recommending we do?”
Natural Anchoring Bias: The Introclusion, stating the introduction and conclusion together, lets you leverage natural anchoring bias. Your reader might still be looking to find fault in an idea, but they have already started anchoring on your conclusion and know where to focus their thoughts and feedback.
Suggested Reading
5. Keep It Simple
Executives at Amazon drive PMs to articulate their ideas concisely.
The Learning
Documents are intense, full of data and details. Everyone uses the smallest font and smallest margins to take advantage of all the space on the page. But when speaking to a room of executives, one should try to keep unnecessary comments to a minimum. K.I.S.S. (“Keep it simple, stupid”) rules when executives are present.
Answer the questions you’re asked. Make your point, and then stop. If what you said was bad and you keep going, you risk digging yourself a deeper hole. If you sold them on your idea but talk too much, you risk highlighting weaknesses.
The Systems in Support
Both the WBR and any meeting where the room reads your document before asking questions require a PM to hone their message. If a PM can’t keep it simple and to the point, executives will pick at the details. Living through this experience multiple times teaches a PM to know the product story and tell it well. Communicate out the metrics clearly but simply. Practice the Introclusion as a general rule.
Rules of Thumb
Tell a four-part story (in two or three sentences)
It looks like this: Give context by explaining the strategy that you and the team are driving. Explain the actions you took, and then discuss what happened. Finish off with the impact. Stop.
The Rule of Three
If you have to present ideas, stick to the Rule of Three. It shows that you thought through the problem but also keeps it manageable. You practiced this for your product interview, so keep it up in your day-to-day work.
Suggested Reading
Summary
These five key habits are part of why Amazon PMs are such strong leaders.
As they build these habits, Amazon-trained PMs learn to express a vision, communicate often, and execute quickly. Furthermore, they develop tactical awareness, hone mental toughness, and build strong teams.
While these habits are formed in the context of strong systems, most ex-Amazonians will retain them for a lifetime—and so will you, if you understand and internalize them.
I hope you have enjoyed learning about the five best practices for Product Managers I learned while I was at Amazon.
