How Amazon Bridged the Insight-Decision Divide

This post was first published on LinkedIn.

At Amazon, all senior leaders are required to take two days of customer service training every other year. Amazon CEO Jeff Bezos in this fireside chat describes one experience he had while being trained. Bezos was taking calls from customers and had an experienced customer service agent listening in and available to jump in if he needed help.

On one particular call, as soon as the customer’s order appeared on the screen, the experienced agent leaned over to Bezos and whispered “She’s going to want to return that table”, pointing to one of the previous orders. Sure enough, the customer told Bezos “I want to return the table”. It turned out the top of the table was scratched because it had been packaged poorly. After handling the return and finishing up with the customer, Bezos turned to the agent and asked “How did you know that the customer was going to return the table?”

“Oh that table always gets returned,” replied the agent.

What Bezos had just experienced is what we describe as the Insight-Decision Divide. Frontline employees by virtue of working with customers and products every day are bombarded with insights that can have a significant impact on the company’s bottom line. However, in most companies, these employees don’t have a voice and their ideas become hidden assets.

Bezos was determined to fix Amazon’s Insight-Decision Divide. To that end, he borrowed concepts from the Toyota Production System by instituting Kaizen Days and the Andon Cord.

Kaizen is the lean manufacturing practice to achieve continuous improvements in multiple aspects of the manufacturing process. By achieving regular and incremental changes, Kaizen results in major improvements over time. With Amazon’s Kaizen Days, small teams are assembled to experiment with different solutions, measuring impact on a small scale before rolling out solutions to the larger organization.

Andon is the lean manufacturing term where any frontline worker can stop manufacturing production because of a problem. With Amazon’s Andon Cord, a customer service agent who noticed repeated instances of customers complaining about problems with a product, was now empowered to pull that product from the website.

Amazon’s Kaizen Days and Andon Cord exemplify three aspects of our Grassroots Innovation Model. With Kaizen Days, Amazon is applying elements of Experimentation and Funding and Support. With the Andon Cord, Amazon is applying elements of Freedom. Kaizen Days and Andon Cord empower Amazon frontline employees to innovate and help drive growth.

Jeff Zias and I are writing the book Grassroots Innovation in the Enterprise to be published this fall. Thanks to former Amazon Principal Engineer John Rauser for sharing this Amazon story.  Do you have a story to share on how your company has bridged the Insight-Decision Divide?  We’d love to hear from you.