When assessing innovation collaboration, Amazon used ONA to identify development connections. Amazon has used ONA to identify decision-making bottlenecks, unnecessary dependencies, and untapped expertise to improve decision-making speed and collaboration for innovation. 10 ONA results pinpoint strengths and potential opportunity areas through team collaboration and coordination. ONA is a way to visualize how communications, information, and decisions flow in an organization by analyzing the informal employee relationships. The Amazon Devices organization, responsible for building products such as Alexa, FireTV, Kindle, and other Amazon products, uses organizational network analysis (ONA) to inspect and audit its team structures.
As a result, Amazon continuously evaluates their organizational designs and the impact of the team structures on execution speed and innovation. STO and two-pizza team organizational structures are not always perfect.
Additional mechanisms ensure that teams are delivering the right results at a consistently high bar.Įvaluating Amazon’s Agile Team Structures
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STOs also understand higher level organizational goals and are free to make the right tactical decisions on their own. These mechanisms allow STOs to understand work required and allow independent, autonomous progress against key efforts. For example, individual teams will set goals that map to their development cadence (e.g., monthly, quarterly) and the STO conducts audits against these goals in the rhythm of the business.
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Because the business moves so quickly, Amazon uses weekly, monthly, and quarterly business reviews roadmap reviews and program reviews for STOs to audit against deliverables and update their plans. This process provides senior leadership visibility to proposed key investments. Coming out of the process, team goals are created that align to overall priorities for the organization. Amazon uses an annual strategic and operational planning process for teams to describe critical investments and goals for the upcoming year and the associated required resources. STOs also act as a bridge to larger organizational efforts. The STO approach guarantees that at least one person at Amazon will wake up every day trying to drive a single critical initiative forward without competing priorities. This implies that if a team is empowered to innovate and problem-solve on their own, they will be more successful in the long run.Ī Single-Threaded Owner (STO) is a leader responsible for managing one or more two-pizza teams and protecting them from distractions. The two-pizza team model is exactly what it sounds like-no team should be larger than what two pizzas can feed (about six employees). 6 Amazon has adapted a nimble “two-pizza team” structure to stay close to the customer, avoid distractions and competing priorities, and make quick decisions. 5 Agile teams are small and composed of multidisciplinary employees (defined as employees in job families outside of their own and generally includes tech and non-tech employees) who break up large, complex problems into manageable modules and build solutions for each component that are then integrated into a comprehensive whole. Companies are more likely to be successful staying close to their customers and adapting to changing conditions if they use flexible, agile team structures. With rapid changes across technology, regulations, demand, and external trends, it is critical for companies to respond and adapt quickly in order to innovate faster than their peers. See Table 1 for characteristics describing Day 1 versus Day 2 companies. 3 A Day 2 culture would be described by Cameron and Quinn as hierarchical, focusing internally on stability, control, and efficiency and valuing routine, formality, and consistency. Compared to Day 1, Day 2 organizations are described as: (1) being too focused on following organizational processes even if the outcome is undesirable to the customer (2) unable to quickly embrace external trends (e.g., cloud computing and artificial intelligence) (3) managing to proxies (e.g., using market research as a proxy for customers) and (4) making slow decisions. Companies with an adhocracy culture value growth, variety, and stimulation, which encourage risk-taking, creativity, and agile ways of working. Cameron and Quinn’s Competing Values Framework 2 would describe Amazon’s Day 1 as an adhocracy culture type that is flexibly structured and externally focused on customers. These two factors have enabled Amazon to rapidly go-to-market with its innovative products and services. In fact, customer obsession and quick decision-making are key to avoiding organizational stasis and are essential for maintaining Amazon’s unique Day 1 culture.