Bezonomics: Spinning the AI Flywheel

How influential is Amazon’s business model in our society today?

Brian Dumaine, the author of Bezonomics asked an acquaintance working at Bain & Company…would you like to co-author a book on how to compete with Amazon?

The acquaintance replied…we are making so much money consulting our clients on that very subject…why give away the secrets?

Reference: Bezonomics: How Amazon is Changing Our Lives and What the World’s Best Companies Are Learning From It …by Brian Dumaine


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Bezos Day 1 Credo

  • Find your passion to invent
  • Always think long term
  • Be very, very customer-centric

What is Amazon’s Flywheel?

The Amazon Flywheel  is a strategy that creates a virtuous cycle by leveraging a an exceptional customer experience to drive traffic to the platform and and its third-party sellers.

This improves the selections of goods, and Amazon further improves its cost structure so it can decrease prices which attracts more traffic which spins the flywheel faster as it continues to grow larger over time.

Artificial Intelligence (AI) and Machine Learning models are still in developmental stages at best for most companies…

Amazon is the real deal and pioneered the new business model for the 21st century,

Amazon consumes unprecedented levels of customer data and applies Artificial Intelligence and Machine Learning algorithms to become a self-learning business model.

As Amazon learns more about the customer’s needs, wants, and desires…it begins to make more accurate product recommendations.

Customer satisfaction increases…as do the sales…and the flywheel spins faster.

Amazon Integration – a personal Inventory

While writing this post, I paused to think about how much Amazon is involved in my everyday life…

-Amazon Kindle Fire tablets (around the house and under car seats?), some screens cracked, some not, some in use, some not…I can’t even remember when I bought them or if they were Christmas gifts.

AWS: Switched from studying for Cisco certification to AWS Certified Cloud Practitioner midstream.

Prime Video: Originally built to be an incentive to get you to sign up for Amazon Prime (worked on us), now my wife and I are working our way through The Man in the High Castle.

Prime Music: Driving home from Pittsburgh (2.5 hour drive), was having fun with free version (2 million songs) of Prime Music. Using Alexa voice commands to request tunes….9 out of 10 songs I wanted were available…I got pissed off when Neil Diamond’s – Sweet Caroline was not on the free verson…

What else could I do?

Alexa recommended I verbally request a 30 day trial of the full version of Prime Music…

So I did…

I listened to the songs I wanted…my credit card was charged 30 days later and it’s still a digital service I enjoy today…

Customer-centric…yes. Amazon makes it too easy to not buy.

Next Up

Whole Foods and The Last Mile -2 Day Delivery…1 Day Delivery…how about fresh food within hours?

Logistically “the last mile” is the most difficult. How does Amazon plan to tackle this endeavor?

By vertically integrating Fleet Operations and creating business opportunities leveraging it’s backbone technology of course.

Naturally, this is a pilot for electric powered and eventually autonomous self-driving fleet delivery vehicles.

And beyond

Staying true to his Day 1 Credo, Bezos is thinking long term with his Blue Origin project. For the purpose of …Colonizing the Moon…not even going there.

I guess when you’re the worlds richest person, life gets boring here on Earth?

Wrap up

My book summaries are biased from the start because I wouldn’t publish them if I didn’t like the book. Having said that, Bezonomics was a great read/listen.

It’s not all apple plums and cherry blossoms, Bezos does come under fire for accusations about stressful labor conditions which the book covers in great detail. Also, with a company growing as such speed and scale, Anti-Trust and Government opposition becomes inevitable…also covered well in the book.

Despite these things, I’ve come to two conclusions after listening to this book:

  • It’s great being a customer of Amazon.
  • All business’s need to get started on their own Flywheel and start spinning.

TRY AUDIOBOOKS…

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Your free trial membership includes 1 free Audible credit good to exchange for your first audiobook. A friendly email reminder is sent before your trial ends.

Curious about audiobooks? You are not alone.

According to a Deloitte article, The Rise of Audiobooks and Podcasting By Duncan Stewart, Mark Casey, Craig Wigginton “The United States’ audiobook market—predicted at US$1.5 billion in 2020, and growing at a seemingly sustainable 20 to 25 percent per year for the next few years—is the world’s largest.”

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Bruce Sinclair’s IoT-Inc: Key Takeaways to Win in the Outcome Economy

IoT’s Blueprint for Creating Business Value

Book cover for 'IoT Inc. How Your Company Can Use the Internet of Things to Win in the Outcome Economy'
IoT Inc. – Key Takeaways
IoT Inc. is the definitive guide to the Internet of Things for business minded professionals.  

It covers all the technical aspects you would expect but more importantly delves deep into the business value of the IoT.

The book clearly explains how products, platforms, and ecosystems work together to create the Outcomes Economy that will ultimately yield the "trillion-dollar market-size projections typically attributed to the Internet of Things".   
  
 
REFERENCE:
IoT Inc: How Your Company Can Use the Internet of Things to Win in the Outcome Economy by Bruce Sinclair

Disclosure: This blog is compensated from affiliate links. Click here for details.

key takeaways

  • IoT Inc. starts with and goes deep on the topics near and dear to business manager’s heart…business value, monetization, and strategy. Frankly, by first establishing the value proposition in these key areas…the technology aspects of IoT make a hell of a lot more sense.

  • In Digital Transformation circles most folks agree that it is Business Models not Products that drive true competitive advantages. IoT Inc. gives great detail for each model and the advantages specific to the IoT on a journey through the “IoT Business Model Continuum”.

  • IoT Business Models
    • Product Only: safe starting point, IoT augments functionality.
    • Product-Service: ex. adding information service from collected data increases value.
    • Service: ex. Rolls-Royce jet engines, customers down’t want to own and maintain jet engines, they want propulsion for their planes. Trade a huge capital expense for recurring fee.
    • Service-Outcome: seller becomes a business partner. ex. improve efficiency of a large turbine wind farm and share the upside.
    • Outcomes: king of IoT business models, pays out based on improving the P&L. ex. John Deere & AGCO…”these competing ecosystems bring together farming machinery, seed management, irrigation, and weather data to sell farmers outcomes of higher crop yields at lower costs”.

  • IoT Inc. explores the IoT’s operational changes that affect every department:
    • Engineering – All efforts that create Intellectual Property (IP) should be moved in-house
    • DataData science and analytics will become fundamental to all industries.
    • Manufacturinggets folded into engineering because of software/hardware connection
    • Business Development leverages a new view into customer’s product usage
    • HR hire new titles. IoT full-stack developers are a prize.
    • Legaldata privacy.

  • IoT Inc. is not a technical manual but in my opinion it does a nice job with it’s explanation of the technical stuff…covering sensors, embedded systems, software, cloud and even APIs to drive additional value from IoT ecosystems.

wrap up

IoT Inc. How Your Company Can Use the Internet of Things to Win in the Outcome Economy is the first of it’s kind to uncover every stone as it relates to the Business Value of IoT. I fully concur with Bruce as he states, “IoT’s greatest challenge isn’t technical; it’s business”. Within it’s pages, company leaders will find a practical guide and blueprint for creating business value with IoT and yes…making money!


TRY AUDIOBOOKS…

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Your free trial membership includes 1 free Audible credit good to exchange for your first audiobook. A friendly email reminder is sent before your trial ends.

Curious about audiobooks? You are not alone.

According to a Deloitte article, The Rise of Audiobooks and Podcasting By Duncan Stewart, Mark Casey, Craig Wigginton “The United States’ audiobook market—predicted at US$1.5 billion in 2020, and growing at a seemingly sustainable 20 to 25 percent per year for the next few years—is the world’s largest.”


Amazon Associates Disclosure:
Christian Shaffer is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to amazon.com.


Interested in IoT related careers? Free IoT Career Playbook

The Technology Fallacy: 6 Key Takeaways for Digital Transformation

Toto, We’re Not in Kansas Anymore…

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Using the analogy of Dorothy from the Wizard of Oz not being in Kansas no more, The Technology Fallacy team does a masterful job navigating the Digital Transformation (DX) landscape making it clear that the new work environment is rapidly evolving and things will never be the same.

REFERENCE:
The Technology Fallacy - How People Are the Real Key to Digital Transformation Gerald C. Kane, Anh Nguyen Phillips, Jonathan R. Copulsky, and Garth R. Andrus

Disclosure: This blog is compensated from affiliate links. Click here for details.


Interesting Stat…

Tallying poll results from thousands of respondents ranging from executive level to front line workers reveals that….

87% agreed digital transformation will disrupt their industry while only 34% felt their organizations were doing enough to be prepared for the changes ahead.


speed of technology Adoption shifting…

In years past, employees were afforded the opportunity to work with technology platforms through their employers.

Nowadays, with connectivity being so ubiquitous and the cost of digital platforms being affordable to individuals, organizations are challenged to retain talent that may opt to fund their own solution sets and serve the market directly.


Young techies versus Seasoned Executives…

Younger generations naturally more akin to rapid technological advancement don’t necessarily hold any particular advantage in the overall success of a company.

Research shows it is easier to teach a seasoned executive what they need to know about digital business than it is to prepare the younger technologist with the experience needed to lead an organization’s digital business efforts effectively.


a key challenge to Digital transformation…

A key challenge that seems universal to all organizations is moving Digital Transformation initiatives forward while attending to the existing business.

Overcoming this challenge calls for an agile approach. A legacy company must have the willingness stray from successful formulas of the past designed to optimize efficiencies and minimize operational variances.

Today’s successful enterprise will adapt itself to “Test Fast, Learn Fast and Scale Fast”.

What used to constitute a failure now holds the lessons needed to open the door to greater success.


Neutron jack’s world no more…

The book offers a great anecdote to showcase how much things have changed in a few short decades by reflecting on Jack Welch’s rise with GE in the 90’s.

Jack used a Six Sigma approach focused on variance reduction and optimizing around old variances.

In contrast, running experiments is essential for today’s enterprise to know what is possible.

New challenges are becoming the norm. From the book, “In the digital age, how companies deal with setbacks may determine their ability to survive”.


Transformation is a process…

Because Digital Transformation is so iterative and constantly evolving the authors describe organizations as “digitally maturing” through this process.

The Technology Fallacy team conducts a cluster analysis of executive and employee respondents to determine 5 key cultural characteristics of a “Digitally Mature” company…

  • Less hierarchical, more distributed leadership
  • More collaborative and cross functional
  • Encouraging of experimentation and learning
  • More bold and exploratory with a higher tolerance for risk
  • More agile and quick to act

Ultimately, Digital Transformation is not about adopting new technologies, it’s about “organizing, operating and behaving effectively in the new world of work”.


wrap up…

The Technology Fallacy is a great read or listen. I’d go as far as to say, a required resource for anyone dealing with or responsible for leading digital transformation within an organization. My extraction is just a handful of points that resonated strongly with me. The book is well researched and loaded with great anecdotes and insights from the research. Each chapter culminates with strategic guidance and tips for becoming “digitally mature”.


TRY AUDIOBOOKS…

This image has an empty alt attribute; its file name is Audible-Free-Trial.png
Your free trial membership includes 1 free Audible credit good to exchange for your first audiobook. A friendly email reminder is sent before your trial ends.

Curious about audiobooks? You are not alone.

According to a Deloitte article, The Rise of Audiobooks and Podcasting By Duncan Stewart, Mark Casey, Craig Wigginton “The United States’ audiobook market—predicted at US$1.5 billion in 2020, and growing at a seemingly sustainable 20 to 25 percent per year for the next few years—is the world’s largest.”


Amazon Associates Disclosure:
Christian Shaffer is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to amazon.com.