It's Always Day One

John Hambacher

April 06, 2021 It's Always Day One Season 1 Episode 42
It's Always Day One
John Hambacher
Show Notes Transcript

John was director of operations and programs at Amazon kindle. He speaks to an array of different mechanisms they implement internally that you can take learnings from.

In this episode we discuss:

  • Asking your team to improve by 1X, 2X and 3X vs. Asking for marginal gains
  • Challenging those around you to think revolutionary rather than evolutionary
  • Understanding the importance of diving deep into an area where you're marginally under performing
  • Data hygiene, why clean obsessing over clean data is so important for ongoing improvements

You can find John on LinkedIn here.

[0:00:00] George Reid: Welcome to us Always Day One. My name is George Reid, a former Amazonian turned Amazon consultant. Each week on the podcast, you're going to hear industry experts, brand owners and Amazon employees share their answers to the basic yet fundamental questions. You should be asking yourself, Bang your Amazon business. Now, let's jump in. Hello, ladies and gentlemen, Thank you for joining me for another episode of It's always Day One. Today I've got John on the show, and we're gonna be talking a little bit about his experiences at Amazon and digging in some of the mechanisms that he was using during his time there. John going to give us a brief intro that we can get cracking?

[0:00:39] John Hambacher: Absolutely. Absolutely. I spent roughly 10 years at Amazon, starting when Amazon was merely a large company. Before it was absolutely massive. Company and I left Amazon this past summer, and I'm now with a startup called True Med Systems That makes a solution for vaccine management and storage.

[0:01:01] George Reid: Well timed for that move. I've seen, um, so one area that I wanted to get straight into It was a question you fired over to me, which I was very interested in this morning when I was doing some final prep and it actually sent me off in a massive tangent around that 62nd idea which sent me into a rabbit hole. But regardless you mentioned about during your time at Kindle you had this idea of any book in 60 seconds. I love whatever that means. And I'm sure you're gonna tell me what you want to break down Exactly what that means and how that change your mentality going forward?

[0:01:38] John Hambacher: Yeah, absolutely. So when the Kindle Service launched along with the device back a couple years before I even joined the company, one of the marketing taglines for Kindle was any book or every book ever written to any customer anywhere in the world in 60 seconds or less. So very, very aspirational sort of product, mission statements and some implied promises in there. And the part that you and I were riffing about an email was the any book in 60 seconds bit. And the concept was instant gratification. So customer goes through however much trouble they want to go through to figure out what's the next great book I want to read. Do I want to paper back door. I want a hardcover. Oh, wow. I want to try a digital edition. I want to try Kindle between the time the customer pushes the buy button. We wanted them to be able to start reading the book in a minute or less so, like, instantly, I want to read the next Michelle Obama book Boom. They can be straight away into it if they want to. And just the speed. The speed was a very specific promise. We thought it was impressive and, you know, for a new product, Digital reading really hadn't taken off. By then it had been tried, but Amazon and Kindle was the catalyst to make it really, really mainstream. Having a really strong promise like that, we thought, would be a great first impression for the service for customers. Hey, the first time I tried Wow. Like I got the book right away. I'm used to waiting days together or having go all the way at the bookstore. So, in terms of just a great out of the box experience, we thought it was impressive. The company thought it was impressive, and so it became part of the product promise

[0:03:21] George Reid: and moving forward. Did you apply that kind of 62nd mentality Or, more importantly, probably the instant gratification mentality to other parts of the business at all?

[0:03:33] John Hambacher: Well, so the interesting part of it and the reason I brought up the example is potentially being a good one for this conversation is because it was such a strong promise to customers. You know, the way Amazon works, very data driven and very customer driven. It became a measuring stick for that part of the service, for sort of the purchase to fulfillment part of the customer experience to to the point where, you know, again, Amazon State of Driven. You can imagine senior people sitting in a room on a weekly ish basis actually looking at that week's achievement of that number and looking at what's our 95th percentile time? What's our 50th percentile time? Where they're gaps? How are we doing? Um, so So that kind of thing at a place like Amazon is taken very, very seriously. Uh, how are we doing relative to that? It's not. It's not. A tagline is kind of thrown out there, and then we sort of try best efforts. Um, it was. It was a super serious and a lot of effort put into measuring it. And then the what I found interesting because I came in after that was established and just getting used to Amazon observing behavior, etcetera. The interesting thing was some of the second order effects around. For example, if you were developing a feature that could impact that 62nd timing, there was a high bar. Should we do the future? How is it designed? Have we measured performance? How do we know it's not going to slow things down? Um, and so, by second order effect, I mean, not even the team that directly owned that part of the product and ancillary team that was developing something understood that promise understood the importance of the measurement, the importance of customer experience and factor that into their design because they knew they were going to be held accountable if if that performance degraded and so it created these really beneficial effects in terms of customer experience, it's a form of of getting that kind of out there without a ton of top down central enforcement, so that the cultural aspects of the bits that I found kind of the most interesting,

[0:05:45] George Reid: and this kind of speaks to the other mentality Amazon of looking around corners like we're bringing this new feature forward. We think it's gonna be beneficial for the customers, which usually is because they're working backwards. But then there's that kind of internal debate going. I'm looking around the corner. I know there's going to be a knock on impact if we think about even business, the business you're in at the moment. Are you still applying that mentality of going? We're holding ourselves to this. We're holding ourselves accountable to a high bar over here, which, which could be anything it could be seller fulfilled prime, for instance, and fulfillment and getting out for X time. That's the high bar, but we're still looking to innovate, and therefore we're looking to, I don't know, make the packaging a little bit nicer and put an insert in it. So there's a continuous thought process of going. What's the impact going to be if we look around the corner? How how are you applying? Kind of applying this now in your day to day control? Are you still having that mentality of Well, we want to hold ourselves accountable. But you also want to innovate. And we all sort of ensure that we're looking around corners. So everything aligns.

[0:06:54] John Hambacher: Yeah, I am using that mentality. Not exactly the same way startups were. I would say we're not a large start up yet. We're in a high growth phase, a lot of promise in the future. But we're trying. We're trying to scale right now. And so as we're trying to scale, we're taking what were what have been processes and practices that were done by a handful of people. All sat in the same room and could put their head above the cue balls and just say, Hey, I've got blah, blah, blah and sort of resolve, A real time to laying down the tracks to ride on the future of What are we going to do when we're to exercise for exercise? 10 exercise? And so that's a different kind of a corner to look around because as I'm laying down some of that foundation with my team, I'm thinking about, you know, can I imagine being satisfied with this thing a couple of years from now. If we're X bigger or X higher scale in whether it's inbound, customer support calls or shipments or whatever. So that's the kind of thinking I have to go through. Well, I'd be happy with this. And if if I don't think I will, am I okay with it being throw away work? And in 69 months a year, we have to kind of start over. So there's kind of a cost benefit of in a startup in any business. But in the start up, there are a multitude of fires to put out each and every day. And there's some things that good enough is good enough because there's bigger fish to fry or strategic things to work on. Yeah, that that judgment there is also a judgment of how far around the corner do I need to look on this particular thing? Or is it a two way door type of thing that we can put something in now and that goes on the backlog for later to do more elegant solution?

[0:08:41] George Reid: Yeah, I like that two way door mentality as well, because I think some people in this position and a previous guest staff and has talked about if X happened so three extra sales. Where does the system break? And I think you speak to a little bit there of at the moment, popping their head up and asking The question works fine, let's say from a customer service perspective, But when does that work? If we're getting three times as much inbound leads three times as much sales three times as much. Whatever. Is there anything you can kind of think back to from experience that makes you put things in place around automation and scalability and what stage you may put it in? Is there kind of a tipping point? As a general rule of thumb? Obviously you're in kindles. There's a different experience in comparison to what some of the listeners will have. But

[0:09:36] John Hambacher: yeah, if I if I generalize the two businesses that the common thing or a common thing that I'm dealing with right now is when there's a live kind of life site issue or live customer issue. Because I handled live customer issues with Kindle content, I owned catalog quality book quality, things like that where there could be an actual complaint or escalation from a customer that my team or an engineering team had to address. And with true med, I run technical support around logistics, and there's stuff that happens with real customers. And you have to have an escalation path. And historically it's been looking, see who's on the other side of the floor and hasten. So can you take a look at this unit? There's something weird going on as I think about patterns. I saw an Amazon and Patterns. I saw Microsoft before that, you know, laying down some you know, I'm starting to look at laying down some you know, things like life side triage processes where yeah, at the time of the issue, you swarm and you fix the immediate customer issue. But then you have a little rigor after the issue solved to root cause it figure out if there's above, figure out if there are other things you can do for the service and you have a closed loop that can make your service better over time. And so that's something we have in really rudimentary form. Now where I am, we're taking some steps to make it a little more sophisticated, Um, but I think that will be far different two or three years from now. I don't know how it will be different. It may be more like a big company like Amazon, where you have a ticketing system and you have resolved groups and SLS and automated escalations. And so if if a set of two comes in and it hits this team, the team knows they have two hours to respond or gets escalated. Their boss like that's super overkill for us right now where I work super overkilled. Could I see a day where we need something in that direction? Yeah, maybe if we end up with distributed teams. Today we have 24 by seven support, which is still a small team. But once we're bigger and maybe there's a greater volume of issues coming in overnight, what do you do overnight? Who do you wake up? And so those are all questions we know we need to solve a little more formally in the future where we have them pretty well solved informally right now.

[0:11:58] George Reid: Yeah, I like that mindset of that closed loop and always figuring out the root cause particular when it comes to customer service. If I try and bring it back to create an example, it would be packages keep breaking or certain things keep getting damaged, which presents an A to Z problem, which is always a nightmare for sellers and brands alike. So figure out what's what's making this particular item get damaged in transit. And this is what's causing us. Headache day in, day out. Can we fix it? Um, pivoting slightly. Another area you wanted to discuss, which I quite like the idea of what is putting a team in a box? Um, could you speak to that little?

[0:12:40] John Hambacher: Yeah, it's, um, I like that little phrase of VP I used to work for. There was one side conversation where he sort of explained the thinking to me. And the concept is one. If you have a team owning something, if you ask them to improve their service or their features, performance or whatever, if you ask them to improve by five or 10% versus if you ask them to double performance or cut failures by 90% like the kind of thinking you get is far different. If you tell someone I want five extra through on this thing, they're going to think about it far differently than if you want to eke out another 10% and good leaders and I've seen good leaders used that very intentionally in spots, especially spots that are aligned to customer experience, business growth, etcetera, to put a lot of kind of more revolutionary thinking against the most important thing versus evolutionary thinking. And you can't I mean, it's just not feasible to put the team quote unquote, put the team in in a box on everything, because then you break a team, you lose all your people. That's just that's not good for anyone, but very selectively like this is really important, and we need to make me to make an order of magnitude improvement in it. Um, if you have the right team on it, you will get far more revolutionary thinking you'll get a wow. We have to think about this totally differently because the nips and tucks and tweaks are not going to get us there. It's

[0:14:19] George Reid: kind of like the opposite of the old cycling mentality of marginal gains, which is one certain way of thinking about things, and you could apply that mindset to anything like a listing and going right. I need to tweak one of the main images because, um, that's going to have a 1% impact. But if you then turn around to your digital team and go, we need to double our conversion rate. How are we going to do it? That makes them kind of step back a little bit and go

[0:14:50] John Hambacher: right? Yeah, yeah, yeah. It's like e commerce. Okay, I'm going to take this little element and move it above the fold, move something else below and run the experiment to see how many basis points of better conversions that got, like, Okay, great. And you do that all the time. But then you're right. There's some things where we need to totally rethink the storefront, and we need to totally rethink this product detail page experience. Um, yeah, it's a different. It's a different mode. Uh, and you can't use it. You can use the revolutionary with team all the time. And the best leaders I've seen were extremely intentional about picking which things to do that on and then about how to stay in touch with the team, all the accountable, give them the support they need, etcetera.

[0:15:33] George Reid: And with that, obviously with speaking more to larger teams. How do you manage that? Change a little bit. Because what you're asking to do is often I imagine going to get a bit of a okay. That's quite I did a step back for those not looking at a video,

[0:15:51] John Hambacher: you're gonna

[0:15:52] George Reid: get a bit of a kind of a step back. Like, Are you kidding me? How are we gonna double double conversion? Right. That's absurd. And that's gonna be sometimes can be with the team management. Quite difficult to manage when the about that many literature was much literature out there who speaks about goal setting. If you set something deemed is unachievable, it becomes de motivating. How do you manage that aspect as a manager?

[0:16:18] John Hambacher: Well, it's so situational. I don't think there's one stock answer like you say. You can completely disengage a team by setting goal. That like? Okay, I'm never going to achieve this. I'm gonna go. I'm gonna go look for a rotational role. Um, there are ways to step into something like that where maybe you don't set the goal immediately, but you kick off. Okay? I want us to do a brainstorm or teams go off. Come back in two weeks with two pages on your best ideas for this or that revolutionary change, you could do a dog and pony show competition. You could, um you know, take just that one team and not lock them in a room. But basically, we're meeting in a week. Come to me with your best thinking on that, and so you don't have to set the goal right at the start. You can kind of literate to that a little bit and sort of see what's possible. And if the product thinking, Actually, you can back up setting that bold at the goal. Although sometimes by needs. You know, I've seen top down goals from very high up in Amazon. We have to do this. Here's the objective. Will get it. Um, And you were there. You probably saw the same thing.

[0:17:32] George Reid: Yeah. Okay. I figured out that that speaks a lot. I like your idea. And Amazon did that. Think Big week. Didn't know which I personally never bought into, because I was like, I'm not going to give you an idea if I'm not going to get a nice steak in it. I didn't bite into it. many people will, but that was my perhaps immature mindset. But that week, whatever it was was essentially come up with whatever business ideas you can think of for Amazon can go and implement. And it was a big contest and worked on the premise of We've got lots of talented people, appalling, talented people.

[0:18:08] John Hambacher: I'm sure

[0:18:09] George Reid: there's ideas floating around, and we've got the facilities and resources to implement. The same can work for any company. I guess if you give people a bit of ownership, is that what you're speaking to a little? Here's some ownership. Come back. Yeah,

[0:18:23] John Hambacher: a little bit, you know, a similar a similar thing to think we think Big week or to think Big competition. I forget what it was called down

[0:18:31] George Reid: Microsoft

[0:18:32] John Hambacher: when when Gates was CEO had the same thing we think we can, and people submitted papers and there was a vetting. And then I forget how many of these white papers that Gates would go off for two weeks shut himself. I don't want to study at home or whatever and just read and make notes on some of these kind of big ideas and the ones that were good might have gotten funded, they might have gotten a team to go, you know, to go build something. Um, so that's that's kind of a corporate company level approach that could result in brand new products, brand new services, things that haven't been thought of for customers before. At a at a team level or a division level, you can do the same thing in a little more microcosm. And I've seen that with annual planning cycles. So in preparation for annual planning, I've been part of teams where there was a similar sort of, you know, we're going to have our planning offside in this date, and we're going to have this many hours, and each team is accountable for coming, coming there with papers on one or two big ideas that pertain at least 10 gently to our business. Um, and sometimes there would be guidance or filters on so things that things that could delight or engage a certain segment of customers that maybe we're not as engaged with we want or things that are considered playful that might put the service in a different light. Um, so you know, I've seen techniques kind of scaled down to the team or large team level as well. And and those tend to be a little bit more focused versus just random big idea.

[0:20:05] George Reid: Mhm. And when obviously, Amazon you were thinking back between the customer experience at all times during your time at Kindle. Were there any other examples you can think of where you were thinking of that customer and then you were developing a product on the back of what you were seeing? I think you mentioned before about deep inspection of in product development was one, um, because they've had a little bit about that. Yeah,

[0:20:30] John Hambacher: The deep inspection gets more to the use case of How do you How do you continue eking out 10% year over year improvements across a whole number of things? Because if you hear or see video recordings of Brazos, you know, back some years, talking about high percentage of innovation at Amazon, at least when he was talking about on his videos was small changes by individuals all over the company to improve quality of service customer experience, et cetera. So it's, you know, how Amazon has done is really a balance between those breakthrough ideas and just continuous focus on sometimes a little list of details. And I remember a story from my time in Kindle something my team own around. Um, and this is kind of an e commerce use case of purchase success. So you have a customer. They get to a product detail page, decide they want to buy the Kindle book, Chris the buy button, and one would think that in 100% of those cases, the customer actually buys the book. But it turns out, in the e commerce pipeline in general, you get a little bit of loss post by button because what if the customer's credit card gets declined? Or what if it's expired? Or what if the order pipe languages or whatever, whatever, whatever. So there are any number of reasons that can fail the failure percentages. You know, I don't remember exact numbers. I could quote him if I did, but you can imagine very, very low percentages of failure so someone might look at that and go, We're successful. 99 point whatever spending time were healthy. But in a business that sells millions and millions and millions and millions of books, a few basis points here, and there is actually quite a few customers, quite a bit of money. And so there was an example where we took a deeper look at those numbers. The team that was supposed to own that hadn't prioritized it because they had bigger opportunities to go after. And when the team started decomposing, we found a lot of very, very addressable things we found, you know, things like, Hey, we don't When When a card gets declined, we don't give the customer a really simple, immediate fix up workflow to say it looks like your car declined. You have another car, another payment instrument or it's expired. Do you have a new expiry date or whatever? And so as we drilled as we well, first we had to put in the right metrics. All the services weren't instrumented exactly the way they needed me. So that was a bit of a lift. And then when we got those metrics is a case of all right, where the pockets that we can go address with, you know, things like automated card update features with central payments team and fix up workflows, and we found out actually a meaningful percentage percentage of those failures where customer pushes the buy button. But they already owned the book. So, um, and they forgot, like clearly people they want to hide again. And we didn't have any clear messaging. And so we ended up changing the buy button. If they already owned the Kindle edition two in a lot of cases read now so they could go on the Web and start reading. It reminded them that they already

[0:23:56] George Reid: on, um

[0:23:58] John Hambacher: so those failures weren't actually failures where we felt entitled and more revenue. But it ended up discovering a customer experience break that we made that a little more elegant for customers. And so what started as we have this thing and it looks like a small percentage of failure. When you inspect and dig and dig and dig and dig and dig, you find some gold nuggets that you can go and make it better for customers.

[0:24:23] George Reid: Mhm. I like that a lot. And I think, is this an exercise that it can be applied on so many things? If you look at something like advertising, how can we hone in on a few different areas to make a certain type of campaign more effective. How can we hone in on our returns to understand why our returns 5% instead of 4%? Is it the same thing that's causing it? Can we hone in on whatever and understand why, on one particular page of conversion slightly lower than all others? Or we don't get as many emails sign ups from this card into powers into this. What? What's wrong with this car? I think you can hold in all these details. Um, but then it's a case of managing which fire inverted comments to put out or which opportunity to go after based on the return you're gonna get. Um, because I think a lot of people right now we're just keeping the head above water. Um, in a good sense, because things are growing very quickly, but it's a keeping up with demand, etcetera. But I think one of the key things to take from it, as well as actually having that data in the first place, whatever it is, you have the ability to look and go. A lot of people are not completing that purchase because of these 10 reasons. Um, if you can go why people complaining they're coming through to your customer service having something there which categorizes what those complaints for so you can then go. We're getting a lot of complaints around breakages, and it's extra sense of 10,000 orders in the last year that allows them to make more well informed decisions. So the data plays a big piece, right?

[0:26:06] John Hambacher: Data plays a big piece, and, you know, as I'm finding in my current business, any data that's manual kind of labeled by humans, such as the four tickets, etcetera. The data quality is the name of the game, and

[0:26:20] George Reid: you were still small

[0:26:21] John Hambacher: enough. I am personally examining almost every ticket every week and re categorizing the ones that I catch that sometimes a technical support person when they when they get something inbound, they categorize based on what the customer says, and then they solve the problem, and by the time they solve the problem, they likely know that would cause. But if the phone's ringing, they don't necessarily go and fix the ratification. They closed the case and go on the next call and or, you know, having good data hygiene again. We're not big right now, but I want to lay the foundation to where, you know, in a year and two years, we can really run this business by the numbers and ensuring data quality for all the human touch is going to be It's going to be a big part of that.

[0:27:04] George Reid: Like that time a lot. Data hygiene. John. Thank you. Thank you so much for spending 27 minutes your time today. Naturally, away with me. That's been really beneficial. I like some of the mechanisms that you've talked to and hopefully get you back on in the future.

[0:27:19] John Hambacher: All right. I appreciate it was fun out.

[0:27:23] George Reid: Hey, guys. Just a quick one. If you are enjoying the podcast, I either have some actionable next steps or new ideas. I'd really appreciate if you could

[0:27:31] John Hambacher: one

[0:27:32] George Reid: subscribe to the show and leave us a review. These are really, really important to us, as you probably know, being in the Amazon world and two, if you're looking for additional support with your brand, head over to the website. It's always day one dot co dot UK where we've got links to other resources. As often our guys speak soon