This week’s provocation:
I spent a few days with Diageo’s European leadership team in Dublin recently and whilst there I saw a talk from Amazon’s supply chain lead Marcus Mallon who talked about how the company innovate. Amazon are of course known for their customer obsession and ‘working backwards’, their relentless experimentation and openness to fail, and for combining a long-term vision with a willingness to be misunderstood. Bezos once famously said:
‘I don't think that you can invent on behalf of customers unless you're willing to think long-term, because a lot of invention doesn't work. If you're going to invent, it means you're going to experiment, and if you're going to experiment, you're going to fail, and if you're going to fail, you have to think long term.’
But what stuck with me most about the talk was how they had systemised innovation through a reinforcing combination of four fundamentals which is sometimes represented as a formula: architecture and organisation amplified to the power of mechanisms and culture.
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Each element plays a key role in enabling systemic innovation, so I’ve written up my notes and augmented them with a few other thoughts on how they bring this to life.
Architecture: Scalable, modular, and service-oriented
In many companies innovation dies in complexity. Yet Amazon’s architecture is intentionally designed to remove blockers and let teams move fast, scale safely, and iterate independently. There are several elements to this:
Service-Oriented Architecture (SOA): Early in its journey, Amazon broke down functional outputs into modular, API-accessible services. This enabled teams to build without stepping on each other’s toes.
Internal platforms: Teams leverage powerful shared tools (like AWS, ML toolkits), reducing friction and duplication.
Loose coupling, tight alignment: Teams can innovate freely within a bounded, interoperable system.
In fact the very architecture that enabled teams to innovate internally later became a product: AWS (that’s innovation that pays twice I guess).
Organisation: Structuring for autonomy, focus, and accountability
Accountability and decision rights are often blurry or distributed in large organisations. At Amazon, organisational structure and decision-making follows intent. It’s designed for speed, clarity, and empowered ownership.
Two-pizza teams: Small, autonomous, and multidisciplinary teams that can build end-to-end without top-down interference. Each team has a ‘fitness function', a defined business metric that the leadership agree with the team lead.
Single-threaded leaders: Each major initiative has one person fully focused on it, meaning that there are no contradictory agendas.
Clear ownership: Every product, system, and metric has a directly responsible individual. No ambiguity means no hiding.
Mechanisms: Turning bold ideas into repeatable practice
Great innovation cultures can’t scale without the right rituals and systems. The idea behind Amazon’s mechanisms is that they turn principles into practice and enable thousands of teams to experiment, launch, and iterate every day.
PR/FAQ Process: Every idea starts with a future press release and internal FAQ. This clarifies intent, forces customer-centricity, and prevents building for the wrong problem.
Bar raisers in hiring: They aim to ensure that every new hire elevates the standard, bringing intellectual rigour to idea generation and execution
Leadership principles: These are public, but also baked into decisions, reviews, and promotions.
Culture: Customer obsession married to long-term thinking
Amazon’s intent has long been to foster a culture which institutionalises customer obsession.
The working backwards methodology means that every product starts with a clearly defined customer need.
Failure isn’t feared, it’s budgeted for. Marcus used the example of how the Fire Phone flopped dramatically, but then paved the way for Alexa.
Amazon’s ‘Day 1’ philosophy fights entropy. The moment a company stops acting like a hungry startup, it starts dying.
These four pillars are not siloed but instead reinforce each other to create a self-sustaining innovation system and a self-reinforcing flywheel (I’m a fan of flywheels). Culture sets the mindset (customer obsession, long-term thinking). Mechanisms turn that mindset into consistent behaviours and action. Architecture provides the infrastructure to support rapid, safe experimentation and scalable execution. Organisation ensures the right people are empowered to move fast with focus.
It’s a fascinating example of how to build an innovation system within a large organisation so that innovation is expected not exceptional, distributed not centralised, and treated like infrastructure rather than theatre.
