Amazon (NASDAQ:), one of the world’s largest e-commerce and cloud computing companies, is known for its efficiency and innovation.
However, former employees have shared mixed experiences working for the tech giant, highlighting both the benefits and challenges.
A common positive aspect noted by former employees is Amazon’s competitive compensation package. The company offers attractive salaries, comprehensive health benefits and stock options.
John Rossman, a former Amazon executive, discusses how performance-based and equity bonuses can significantly improve overall compensation levels in his book The Amazon Way: 14 Leadership Principles for the World’s Most Disruptive Company.
The company’s focus on innovation and customer obsession is another attractive factor. Many employees find a fast-paced, fast-paced work environment to be intellectually stimulating and conducive to rapid skill development and career advancement.
However, Amazon’s stressful work culture has its downsides. Common complaints include high levels of stress and burnout. In an in-depth 2015 New York Times article, several former employees described the unrelenting pace and long hours, and some cited a lack of work-life balance.
One notable account comes from Susan Harker, a former top recruiter at Amazon, who detailed the company’s rigorous performance appraisal system and the pressure it puts on employees to consistently deliver results.
Physical and mental stress is especially noticeable in Amazon fulfillment centers. James Bloodworth, an undercover journalist who worked in an Amazon warehouse, described his experience in his book Hired: Six Months Undercover in Low-Wage Britain.
He described grueling conditions, including long shifts and strict performance metrics, that left many workers exhausted.
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Needham analysts weigh in on what it’s like to work at Amazon
During the 19th annual Needham Technology and Media Conference earlier this week, former Amazon employees shared with analysts their views on the company’s work culture in AWS, video games and last-mile logistics.
Here are 10 key takeaways from their discussions, as outlined by Needham in his note Wednesday:
1) Culture of debate and commitment: One of the best aspects of working at Amazon is the culture of “discussion and decision-making,” Needham said in his note, citing discussions with former company employees. Employees are encouraged to express their opinions during meetings and active debate is valued. However, once a decision is made, everyone is expected to fully support it.
2) Documentation and Burnout: The requirement to provide written documents for every initiative is often cited as the worst aspect of working at Amazon, Needham noted.
“The second worst thing is burnout because the culture is hard-working,” they added.
3) Data-driven decisions: Amazon’s 16 leadership principles influence every decision made within the company. All arguments, written or oral, must be supported by data, highlighting the importance of data-driven decision making.
4) Automatic control: As long as the data shows that the business leader is achieving his goals, Amazon tends to stay on the sidelines, although weekly meetings are usually held to ensure consistency.
5) Day 1 Mentality: Amazon promotes a “Day 1” mentality, focusing on innovation and risk-taking. The company hires generalists rather than specialists and rotates them through different positions approximately every two years.
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“It keeps ideas fresh and innovative,” Needham said.
6) Performance plans: It has been noted that HR seems to have a soft quota of 3-5% of employees at any given time being included in Performance Improvement Plans (PIP).
7) Remuneration structure: Amazon’s reward structure has changed. Previously, the compensation cap was $165,000, but now about 50% of total compensation comes from salary and the other half comes from restricted stock units (RSUs), which vest over four years.
“This creates golden handcuffs for full-time employees after 4 years at AMZN, making it difficult to exit AMZN,” the firm’s analysts said.
8) Risk strategy: Reflecting Jeff Bezos’ strategy, Amazon prefers to have two different divisions create the same new product rather than not develop a product at all, promoting a high-risk, high-reward approach to business development.
9) Highly qualified staff: The consensus was that Amazon employees tend to be smarter, more energetic and more competitive than employees at other companies, Needham’s team noted.
10) Customer Experience and Business Focus: Despite the emphasis on customer experience, Amazon employees are very business-oriented and focus heavily on the economics of their products.